GROWTH in UK manufacturing activity slowed in August from an already-sluggish pace, and the sector’s workforce shrank for the first time in 26 months as export orders continued to fall, a survey has revealed.

The Chartered Institute of Procurement & Supply survey provides yet further evidence of the unbalanced nature of the UK’s belated economic recovery.

CIPS’s purchasing managers’ index (PMI) for UK manufacturing, which measures changes in output, new orders, employment, suppliers’ delivery times and stocks of goods purchased, fell from 51.9 in July to 51.5 in August on a seasonally-adjusted basis to signal a slowing of the sector’s expansion.

Although the manufacturing PMI remained above the level of 50 deemed to separate expansion from contraction, CIPS highlighted the fact that it pointed to only a “sluggish” performance.

The survey showed a fifth consecutive month of falling new export orders for the UK manufacturing sector.

CIPS’s manufacturing employment index fell from 51.5 in July to 49.9 in August to signal the first monthly fall in the sector’s workforce for more than two years.

Rob Dobson, senior economist at survey compiler Markit, said: “The UK manufacturing sector remains in a holding pattern, with production growth hovering around the stagnation mark and marginal job losses reported for the first time in 26 months.

“On this basis, the sector looks unlikely to make much of a contribution to the solid gain in broader GDP (gross domestic product) growth expected for the third quarter.”