The official index rose to 50.1 from 49.8 in August, while production increased and employment remained below the 50 mark.

China's manufacturing purchasing managers' index (PMI) rose to 50.1 in September from 49.8 in August, the National Bureau of Statistics (NBS) said Wednesday, returning to expansion territory for the first time since June. The index was 49.2 in July and 49.8 in August.

NBS Reports Gains in Output, Declines in Hiring

The production index rose 1.3 points to 51.7, while new orders slipped 0.1 point to 50.5 and new export orders slipped 0.1 point to 50.0.

The employment index moved in the opposite direction, remaining in contraction territory. It fell 0.3 points to 48.4, while the raw-material inventory index edged up 0.1 point to 48.2. The divergence suggests that higher output did not translate into broader employment gains in September, although one month's data does not establish why.

Twelve of the 21 industries surveyed were above 50, four more than in August. The survey covers 3,200 manufacturers across 31 categories. The survey covers 3,200 manufacturers across 31 categories.

Large Manufacturers Lead an Uneven Recovery

Large enterprises recorded a PMI of 50.6. Medium-sized firms rose 0.3 points to 49.7, while small firms rose 1.0 point to 48.9. Both improved from August but remained below the 50 threshold.

By sector, high-tech manufacturing came in at 52.5, equipment manufacturing at 51.0 and consumer goods at 50.7. Energy-intensive industries rose 0.1 point to 48.0.

Input prices rise more sharply than output prices

The input price index rose 4.2 points to 60.8, and the output price index rose 3.6 points to 54.0. The sharper increase in input prices indicates renewed cost pressures for manufacturers, although the PMI data alone does not show how those costs affected company margins.

Huo Lihui, chief statistician at the NBS Service Industry Survey Center, said higher global commodity prices and stronger demand in some industries drove the increases. Price indexes for petroleum, coal and other fuel processing and for chemical raw materials and chemical products rose above 60 as international crude oil prices climbed sharply, Huo said.

Seasonal demand supports September activity

The China Federation of Logistics and Purchasing (CFLP) said the new orders index for consumer goods makers rose by more than 3 points to nearly 53. It pointed to stocking for the Mid-Autumn Festival and National Day holidays, seasonal changes and the completion of overseas orders.

CFLP also said the effect of extreme weather largely faded in September, and that construction and some consumer-related industries entered their traditional peak season. These factors suggest that some of September's improvements may not persist in subsequent months.

For the quarter, CFLP said the PMI averaged 49.7, 0.5 point below the second quarter and 0.2 point above a year earlier. The new export orders index averaged 49.9, its second straight quarterly rise.

Private survey reports higher manufacturing reading

The RatingDog China General Manufacturing PMI, compiled by S&P Global (NYSE: SPGI), rose to 52.1 from 51.5. S&P Global said output grew at the fastest pace in five months.

The two readings are not directly comparable because they are produced by different organizations using different survey methodologies. However, both pointed to stronger manufacturing activity in September.

Services and construction also gain

The non-manufacturing business activity index rose 1.2 points to 50.2. The services index rose 0.9 points to 50.2, and the construction index rose 3.4 points to 50.3.

The composite output index, which combines manufacturing production and non-manufacturing business activity, rose 1.2 points to 50.7.

Manufacturers report unchanged expectations

The production and business activity expectations index was 53.8 in September, matching August, the NBS said.

CFLP expects manufacturing to keep operating steadily with moderate expansion in the fourth quarter, citing potential policy support and October's traditional peak season for construction and some manufacturing segments.