GROWTH of UK manufacturing activity slowed even further in September to its weakest pace in 17 months, as the pace of increase of new export orders decelerated to a crawl, a survey has revealed.

The survey, published yesterday by the Chartered Institute of Purchasing and Supply, underlines the degree to which Chancellor George Osborne's vision of "a Britain carried aloft by the march of the makers" has failed to materialise.

CIPS's headline purchasing managers' index for the UK manufacturing sector, a composite measure of activity which includes changes in output, new orders, employment, suppliers' delivery times and stocks of goods purchased, fell from 52.2 in August to 51.6 in September on a seasonally-adjusted basis.

While the latest reading is still above the level of 50 which separates expansion from contraction in the CIPS survey, it is well adrift of the reading of 56.8 for June.

Growth of manufacturing activity has, according to CIPS, slowed in each of the last three months.

And CIPS's new export orders index for UK manufacturing fell from 52.7 in August to 50.4 in September. This latest reading signals only a marginal rise in new export orders last month.

There were also sharp slowdowns in the rates of increase of output and overall new orders in the UK manufacturing sector. The survey showed that growth in output, as well as in the composite measure of activity, eased to its slowest pace in 17 months.

The "march of the makers" vision was a central plank of Mr Osborne's March 2011 Budget. Two years later, with economic recovery failing to emerge as envisioned, the Conservative-Liberal Democrat Coalition put in place huge measures to fuel the UK housing market.

Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "This is a significantly softer survey than expected. While the UK manufacturing sector is continuing to expand, it has clearly lost serious momentum compared to the early months of the year. This is disappointing for hopes that UK growth can be broad-based on a sustained basis going forward, and less dependent on (the) services sector."

Mr Archer added: "Particularly worryingly, new orders growth almost ground to a halt in September, which is a serious concern for output prospects in the fourth quarter. This reflected softer domestic and foreign demand."

Paul Hollingsworth, UK economist at Capital Economics, said: "The latest survey indicated the economic recovery became less broad-based in the third quarter."

However, voicing a belief that weaker growth in the sector would not stop the Bank of England's Monetary Policy Committee from implementing the first rise in UK base rates from their record low of 0.5 per cent in coming months, he added: "With growth overall remaining strong, and labour market slack continuing to be eroded at a healthy pace, the slowdown in the manufacturing sector on its own is unlikely to deter the MPC from raising interest rates in the next six months or so."

Rob Dobson, senior economist at survey compiler Markit, said: "The strong upsurge in (the) UK manufacturing sector at the start of the year appears to have run its course, with growth of new orders easing to near-stagnation. Overseas demand was reined in mainly by the ongoing lethargy of the eurozone and the appreciation of sterling against the euro."