UK manufacturing activity grew at a sharp rate again in October, a key survey shows, but the pace of increase of the sector's workforce slowed.
The Chartered Institute of Purchasing and Supply's (CIPS) latest survey of UK manufacturing also showed an acceleration of growth in new export orders to the fastest pace since February 2011.
While CIPS's purchasing managers' index (PMI) for UK manufacturing dipped from 56.3 in September to 56 in October on a seasonally-adjusted basis, it stayed well above the level of 50 which is calculated to separate growth from contraction and thus continued to signal a sharp rate of expansion. The PMI is a composite measure, which includes output, new orders, employment, suppliers' delivery times, and stocks of goods purchased.
CIPS's employment index for manufacturing fell from 52.8 in September to 51.4 in October, signalling only a modest rise in staffing.
Rob Dobson, senior economist at CIPS survey compiler Markit, said: "The manufacturing PMI remains close to August's two-and-a-half year high, with growth of output and new orders both trending near to recent 19-year records."
He added: "Despite...accounting for less than 11% of the economy, the current strength of growth seen in manufacturing means the sector will still provide a major boost to the economy in October, boding well for the strong pace of economic growth we saw in the second and third quarter being sustained into the fourth quarter. The survey suggests manufacturing output is growing at a quarterly rate of around 1% to 1.5%."
The Office for National Statistics said last month that UK gross domestic product (GDP) had grown by 0.8% quarter-on-quarter in the three months to September. This followed a 0.7% increase in GDP in the second quarter. But UK GDP in the third quarter was 2.5% adrift of its level in the first quarter of 2008, ahead of the onset of the Great Recession.
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