The manufacturing sector expanded for the 12th consecutive month last month, boosted by strong private sector output, new orders from the mainland and a strong job market. The Brunswick Hong Kong Purchasing Managers' Index, which reflects activity in the manufacturing sector, rose to 52.6 last month, up from 50.1 in November amid a year-end rush of economic activity as businesses pushed to meet deadlines. The rate of growth of new business was at a three-month high. An index reading of less than 50 indicates that the manufacturing economy is in decline while a figure exceeding 50 shows the sector is expanding. Hong Kong's economy has performed well despite worries about a bird flu epidemic and major government reshuffles, with continued growth in the mainland remaining a key driving factor. The job market has been hot as unemployment rates fell more than one percentage point to 5.3 per cent last year, while consumer prices rose to their highest levels in more than seven years. Exports have also been strong. The government last week said gross domestic product increased 8.2 per cent in the third quarter, up from 7.3 per cent growth in the second quarter. A survey carried out by Britain-based NTC Economics and involving 300 companies reported an increase in mainland orders for the second consecutive month, bringing the pace of new orders to its fastest since May. Firms appeared to have the spare capacity needed to handle the business as backlogs of work fell for the fifth month. The boost in new business helped expand the workforce at its fastest rate in seven months, while purchasing activity rose for the first time in three months. But with business growth came higher operating costs and higher prices to cover those costs. Average costs to companies rose at their fastest pace in three months as raw material costs surged.. Companies were also forced to raise salaries in an attempt to attract and keep the best workers.