The latest S&P Global’s UK Purchasing Managers’ Index (PMI) shows that UK manufacturing’s woes have deepened.
S&P Global’s latest PMI survey, which asks around 600 industrial companies about their performances, suggests that manufacturing is again in the downturn following a poor start to the year.
The latest figure showed that it decreased to 44.9, which was slightly better than the figure of 44.6 that economists had predicted.
This was the lowest reading in 17 months, compared to an average of 51.7 between 2008 and 2025.
Rob Dobson, director at S&P Global Market Intelligence, said the outlook was “darkening” as confidence was plunging across the sector.
“Companies are being hit on several fronts,” said Dobson.
“Costs are rising due to changes in the national minimum wage and national insurance contributions, geopolitical tensions are intensifying, and global trade faces potential disruptions from tariffs.
“Although the impact on production volumes was widespread across industry, it was again small manufacturers that took the hardest knock,” he said.
The manufacturing sector had already taken a turn for the worse in the new year.
The Confederation of British Industry (CBI) said a fall in output in January suggested businesses were “conserving funds” as a result of Reeves’ tax raid, which includes hikes to national insurance contributions (NICs).
Those taxes, which see the threshold at which employers begin to pay the levy drop to £5,000, are set to come into effect this week.
The CBI’s survey said that only three out of 17 manufacturing sub-sectors saw an increase in output.
Meanwhile, the industry body Make UK said a fall in output during the first quarter of the year for the first time in a decade was an “ominous” sign.