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By Bloomberg

French manufacturing shrank more than analysts forecast in November and demand fell, signaling that an economic rebound seen in the third quarter might be short lived.

A Purchasing Managers Index fell to 47.6, the lowest in three months, from 48.5 in October, London-based Markit Economics said today. That’s below the 50-point mark that divides expansion from contraction and compares with the median forecast of 48.8 in a Bloomberg News survey. A separate index showed services also contracted, while new business across both industries fell the most in 17 months.

The euro area’s second-largest economy has barely grown in three years and recent data suggests that 2014 will be little different. With unemployment near a record and the budget deficit widening, President Francois Hollande is under pressure to deliver on his promises of business-friendly reforms.

“The continued softness in private-sector activity signaled by the PMIs suggests an ongoing drag on growth during the fourth quarter,” said Jack Kennedy, a senior economist at Markit in London. “Another round of job shedding by companies during November meanwhile provides little hope of bringing down the high unemployment rate.”

An index of services activity rose to 48.8 this month from 48.3 in October, while a composite gauge for the whole economy increased to 48.4 from 48.2, according to today’s report. Employment across both manufacturing and services fell for 13th month, though the rate of decline slowed compared with the previous month.

The French economy grew 0.3 percent in the three months through September as a jump in public spending offset a fourth quarterly decline in investment. The unemployment rate stood at 10.5 percent in September, more than double than Germany’s 5 percent, according to Eurostat.

Hollande, whose popularity is among the lowest ever registered for a French president, has said he won’t run for a second term if he is unable to bring down joblessness.

In Germany, a manufacturing and services index probably rose to 54 in November from 53.9 in October, according to the median forecast of economists in a separate survey. A similar gauge for the euro area probably increased to 52.3 from 52.1. The German report will be released at 9:30 a.m. Frankfurt time and the euro-region data 30 minutes later.