The droop within the UK’s manufacturing business continued final month with output, new orders and employment all falling, in accordance with a closely-watched survey.
Business optimism within the sector additionally slid to a 12-month low in December, amid consumer closures and excessive rates of interest, S&P Global/CIPS UK discovered.
The companies’ reported that their manufacturing buying managers index (PMI) weakened to 46.2 in December – the seventeenth month in a row that it has been under a rating of fifty, which is the edge for progress.
The determine can also be a decline on a slight enchancment in November, when the index hit a seven-month excessive rating of 47.2.
However firms nonetheless anticipate manufacturing to rise, on common, in 2024, as a consequence of “sales drives and new product launches”, the survey of round 650 producers discovered.
Rob Dobson, director at S&P Global, stated: “UK manufacturing output contracted at an increased rate at the end of 2023.
“The demand backdrop additionally stays frosty, with new orders sinking additional as situations stay powerful in each the home market and in key export markets, notably the EU.
“The downturn has hit manufacturers’ confidence, which dipped to its lowest level in a year, and encouraged renewed cost caution with further cutbacks to stock levels, purchasing and employment.”
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He added: “With concerns about high interest rates and the cost of living crisis hurting demand, the outlook for manufacturers in the months ahead remains decidedly gloomy.
“The downturn in demand is having some optimistic results on provide chains, nonetheless, with suppliers decreasing their costs
for uncooked supplies and vendor lead occasions displaying an additional enchancment.”
The survey additionally discovered a drop in demand from buying and selling companions such because the US, China, Europe and Canada.
Job losses had been recorded for the fifteenth month in a row, partly as a consequence of redundancies and hiring freezes within the sector.
Source: information.sky.com”