THE UK manufacturing sector achieved only lacklustre growth in May, and employment increased only marginally, a survey has shown.
The Chartered Institute of Procurement & Supply's purchasing managers' index for UK manufacturing, which measures changes in output, new orders, employment, suppliers' delivery times and stocks of goods purchased, edged up from 51.8 in April to 52 in May on a seasonally-adjusted basis.
However, it was at 54.3 in March and at 56.7 in May last year.
The latest reading, while above the level of 50 deemed to separate expansion from contraction, signals only modest growth.
CIPS's employment index for manufacturing fell from 50.9 in April to 50.3 in May.
Rob Dobson, senior economist at CIPS survey compiler Markit, said: "Expectations of a broad rebound in UK economic growth during the second quarter of the year are called into question by these readings. Manufacturing looks on course to act as a minor drag on the economy, as the sector is hit by a combination of the strong pound and weak business investment spending.
"The strength of sterling is serving a double-whammy for economic growth by constraining manufacturers' export performance and also driving a surge in cheap imports."
Mr Dobson added: "Where growth is being reported by manufacturers, this remains heavily dependent on the domestic market, and consumer demand in particular. The challenge therefore remains for the new Government to take the necessary steps to revive manufacturing, boost investment spending and improve export competitiveness if any headway is to be made on achieving the long-promised rebalancing of the UK economy."
Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "This is a lacklustre survey, even though the purchasing managers reported that overall manufacturing activity improved modestly in May after suffering a marked loss of momentum in April."
He added: "Lacklustre manufacturing activity is worrying for hopes that UK growth can become more balanced and less dependent on the services sector and consumer spending. Reinforcing this concern, the purchasing managers report that manufacturing activity is strongest relating to consumer goods and is lagging on investment and intermediate goods.
"It is also evident that UK manufacturing exporters are continuing to be hampered by sterling's strength, particularly against the euro."
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