UK manufacturing growth accelerated modestly in September but conditions in the sector nevertheless remained “lacklustre”, a survey shows.
The Chartered Institute of Procurement & Supply’s survey also shows renewed growth in new export orders, after a decline in August.
CIPS’s headline purchasing managers’ index for UK manufacturing, which measures changes in output, new orders, employment, suppliers’ delivery times and stocks of goods purchased, rose from 53 in August to 53.8 in September on a seasonally adjusted basis.
This took it further above the level of 50 deemed to separate expansion from contraction.
But Rob Dobson, director at CIPS survey compiler IHS Markit, said: “Based on its historical relationship with official ONS [Office for National Statistics] data, the latest survey is consistent with output expanding at only a moderate pace.”
Mr Dobson noted that increased orders from other European countries and North America had helped new export business stage a “modest recovery” from August’s contraction.
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But he added: "Despite these causes for short-term optimism, conditions in manufacturing are still relatively lacklustre overall.”
He also cited signs in the survey that foreign companies may be sourcing less from UK-based component suppliers.
Mr Dobson added: “Many UK manufacturers also noted that the backdrop of Brexit and a volatile exchange rate were making any forecasting activity increasingly difficult, with uncertainty adding to reluctance to hire.”
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While the survey signalled overall growth in manufacturing employment, he noted headcounts at larger companies in the sector had fallen for a second consecutive month.
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