Manufacturing activity contracts at its fastest in five months – London Business News | London Wallet

UK manufacturing shrinks at its fastest rate for five months in September which is linked to the automotive industry.

This comes as supply chains have been affected by the Jaguar Land Rover cyber-attack which caused production shutdowns.

The S&P Global UK manufacturing PMI survey which is closely watched by economists shows a reading of 46.2 in the month, compared to 47.0 in August.

Rob Dobson, director at S&P Global Market Intelligence, said, “The final Manufacturing PMI results provide further worrying news for the health of UK industry.

“Manufacturers are facing an increasingly challenging environment, with intakes of new business and levels of production hit by weak market sentiment, a dearth of new export work and a high-cost environment exacerbated by tax and labour cost rises.

“Companies entwined into the autos supply chain are also facing a temporary hit to activity following the cyber-attack on JLR.”

Matt Swannell, chief economic adviser to the EY Item Club, said, “The weakness in September’s manufacturing Purchasing Managers’ Index (PMI) may be exaggerated by businesses’ concerns over tax rises at the upcoming Autumn Budget and temporary factory closures in the automotive sector.

“However, the sector certainly faces weak domestic and external demand as it navigates slowing real income growth, tightening fiscal policy, and a global economy that is still getting to grips with higher US tariffs.”