The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index for September 2018 shows improvement after a disappointing dip in growth for August, posting a value of 53.8 compared to August’s revised figure of 53.0 (initially 52.8).
A reading above 50.0 indicates an expansion of the manufacturing sector compared to the previous month, while a reading below 50.0 indicates a contraction.
The results show that the sector has now been in growth mode for over two years, with results above 50.0 for 26 months; they also show that new business — from both domestic and international markets — is on the up again, along with export business, which fell noticeably in August.
Moreover, more than half of the manufacturers surveyed anticipate increasing their production in the coming months, as they look to improvements in capacity, new equipment, new products, improving sales, and overall organic growth for their business.
David Johnson, founding director of currency specialist Halo Financial, said: “It is encouraging to see confidence restored after a blip in August.
"The UK manufacturing sector continues to demonstrate its resilience and is clearly taking the necessary steps to shore up business for the year ahead — and beyond.
"That pragmatism is a great base upon which to approach the undoubtedly challenging times ahead.”
That said, Mr Johnson did caution that there are factors to be wary of, including pressure on prices.
“Both input and output pricing pressures have increased. Notably, prices have risen across energy and raw materials, including electronic components, food, plastic, metal, timber and resins. This has also widened lead times.”
Meanwhile, Atul Kariya, a partner at accountancy and business advisors MHA MacIntyre Hudson, said: “Around 30% of my clients have raised Brexit as their most pressing business concern in the current market.
"Their number-one objectives remain growing revenue and improving productivity, so doing everything we can to help them navigate the economic and political uncertainty and engender growth is a significant priority from an advisory perspective.
"Being able to adapt to market change and plan for the unknown is no mean feat.”