UK manufacturing output falls to nine-month low

(Sharecast News) - UK manufacturing activity fell to a nine-month low in November as new orders fell, according to a survey released on Monday. The S&P Global manufacturing purchasing managers' index fell to 48.0 from 49.9 in October. This was below the flash estimate of 48.6 and below the 50.0 mark that separates contraction from expansion.

Survey respondents linked declines in output and new orders to delayed investment decisions, cutbacks to new projects due to domestic market uncertainty and rising geopolitical tensions. Some firms also said announcements in the UK Budget had led to budgets being re-appraised at manufacturers and their clients alike.

Rob Dobson, director at S&P Global Market Intelligence, said: "Conditions in the UK manufacturing sector deteriorated again in November. The headline PMI fell to a nine-month low as concerns surrounding the economic outlook, high costs and weak demand led to lower output, falling orders and cutbacks to purchasing, jobs and inventory holdings.

"The export climate also remained bleak, as weaker demand from the US, China and EU led to a further drop in new export business. While companies of all sizes are experiencing a downturn, small companies are the hardest hit, reporting especially marked drops in output, new orders and new export business.

"Meanwhile, supply chain worries have intensified as the combination of the Red Sea crisis, port disruptions and border regulation issues led to longer supplier delivery times, input shortages and rising costs. Input price inflation accelerated as a result.

"With recent budget announcements on labour costs and employer national insurance likely to raise costs further in 2025, and geopolitical tensions heating up notably around the threat of increased global protectionism, manufacturers are left facing an environment of high costs, low demand and raised uncertainty for the foreseeable future."