The operating environment faced by UK manufacturers remained challenging in September, as a quiet domestic market and lower intakes of new export business stymied production volumes and total new order intakes.
The seasonally adjusted S&P Global UK Manufacturing Purchasing Managers’ Index (PMI) fell to a five-month low of 46.2 in September, down from 47 in August, to remain below the neutral 50 mark for the twelfth consecutive month.
Four of the five PMI components (output, new orders, employment and stocks of purchases) were at levels consistent with a worsening of operating conditions.
Manufacturing production fell for the eleventh successive month in September, with the rate of contraction the fastest since March. The effects of the downturn were widespread, with the consumer, intermediate and investment goods sectors all seeing output fall at solid rates.
Manufacturers reported that production had been scaled back in response to weaker intakes of new business, with demand from both
domestic and export markets weak.
New order intakes subsequently fell for the twelfth month in a row, and to one of the greatest extents during the past two years. The worsening of current market conditions was linked to subdued client confidence, US tariff uncertainty and the consequences of a high cost backdrop (especially for energy and staff).
There were also reports that automotive supply chains were being disrupted following production shutdowns at Jaguar Land Rover.
Significant headwinds
The data shows the significant challenges facing the country’s manufactuirng sector, said Cara Haffey (Leader of Industry for Industrials and Services at PwC UK).
“With job losses recorded for the eleventh month in a row, the pressure on employment signals the need for strategic shifts to counteract high operational costs and supply chain disruptions,” she said.
“Despite these hurdles, there is cautious optimism. Eased price inflationary pressures provide a silver lining, and manufacturers are looking towards lean inventories and improved market conditions to boost production. By focusing on innovation and efficiency, the industry can build resilience and prepare for a rebound.”
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