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The UK manufacturing sector continued to weaken in October, according to survey results released on Tuesday, but performed slightly better than initially predicted.
The seasonally adjusted S&P Global/CIPS UK manufacturing purchasing managers' index slipped to 46.2 in October from 48.4 in September. The reading was a 29-month low, but came in above the previous flash estimate of 45.8.
With readings remaining below the 50.0 no-change mark, October marks the third consecutive month of contraction in UK manufacturing.
Among the key issues cited were weak demand, high inflation, and supply chain constraints, as well as political and economic volatility.
"New work intakes fell at the quickest pace since May 2020 as demand in domestic and export markets weakened. While the downturn has lessened the pressure on prices, the weak pound and high energy prices mean elevated cost inflation remains a prime concern for manufacturers," said S&P Global Market Intelligence Director Rob Dobson.
Dobson noted the "darkening situation" drove business optimism among UK manufacturers to a two-and-a-half year low, as fears over weak demand, an imminent recession, inflation and persisting uncertainty plagued the sector.
"The labour market picture has also deteriorated, with companies cutting jobs for the first time in almost two years while still struggling to recruit and retain appropriate staff. On current form manufacturing is in no position to help prevent the broader UK economy from sliding into recession," Dobson concluded.
The S&P Global/CIP UK manufacturing PMI is compiled from responses from surveys sent to purchasing managers at around 650 UK manufacturers, with data collected between October 12 and 26.
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