Economy
May saw the UK manufacturing sector maintain one of its brightest spells of output and new order growth in the 22-year survey history, according to the latest Markit/CIPS Purchasing Manager’s Index.
The data suggests that as manufacturers ramped up production to meet strong inflows of new work from both domestic and export markets, the benefits were also shared with the wider economy through solid job creation and rising levels of input
purchasing.
“The revival of UK manufacturing continued in May, as the sector basked in one of its brightest growth spells of the past two decades,” said Rob Dobson, Senior Economist at Markit.
“Manufacturing production is currently expanding at a quarterly rate close to 1.5 percent, according to the PMI, helping the sector take huge strides towards recouping the output lost during the recession. However, with manufacturing still some 7.5 percent smaller than its pre-crisis peak, even at this current growth rate it would take until late-2015 to achieve full recovery.”
At 57.0 in May, the PMI posted close to April’s five-month high of 57.3 and again registered one of its highest readings in the survey history. The PMI has now signalled an improvement in overall operating conditions in each month since March last year.
“The upturn remains broad-based by sector and is being enjoyed by SMEs and large-scale producers alike. A sharp re-acceleration in demand for goods such as plant and machinery also points to ongoing growth of business investment. A strong domestic market is meanwhile being supplemented by one of the best growth phases for new export orders in the survey history. The benefits of the manufacturing upswing are also being shared with the wider economy through solid job creation,” Dobson continued.
David Noble, Group Chief Executive Officer at the Chartered Institute of Purchasing and Supply, said: “British manufacturers march onwards to mirror last month’s strong performance. Growth of new business and export orders remained strong in May, and firms are ramping up production to meet this demand. As a result, and in line with robust economic conditions, it can be said, that we’re starting to see real evidence of a sustained recovery for the sector.”