UK Manufacturing Growth Reaches 15-Month Peak as Output and Orders Improve in December
S&P Global PMI data show Britain’s factory sector expanded at the fastest pace in over a year, driven by higher production and renewed demand
The United Kingdom’s manufacturing sector ended 2025 on a decidedly stronger footing, with official survey data showing the fastest expansion in activity in fifteen months as output and new orders rose.
The seasonally adjusted S&P Global UK Manufacturing Purchasing Managers’ Index climbed to 50.6 in December from 50.2 in November, comfortably above the fifty-point threshold that distinguishes expansion from contraction and marking the most robust reading since mid-2024. Output increased for the third consecutive month, underpinned by stock building and efforts to clear backlogs of work, while new order intakes rose for the first time since September 2024, with burgeoning domestic demand the principal driver of the uptick.
The pace of expansion was, however, uneven across the sector; large manufacturers reported stronger growth in production and new work, while small and medium-sized enterprises continued to see softer conditions.
Employment remains a weak spot, with job losses recorded for the fourteenth straight month, though the rate of decline eased to its slowest in that period.
Firms also reported rising input costs, citing higher prices for materials and energy, and some pass-through to output prices after a period of relative price stability.
Export orders, while still in contraction, showed signs of stabilisation as the decline eased to one of the weakest rates in nearly four years.
Analysts noted that the recovery in UK factories coincided with receding headwinds from late-year budget uncertainty and the resumption of normal operations at major manufacturers following earlier disruptions.
While the headline data point to a tentative recovery in British manufacturing, confidence among producers remains cautious, with broader economic and geopolitical challenges continuing to temper sentiment.
Nonetheless, the December reading — the best in more than a year — suggests that the sector may be finding firmer ground as it transitions into 2026, buoyed by improving domestic conditions and a modest upturn in new order flows.
The seasonally adjusted S&P Global UK Manufacturing Purchasing Managers’ Index climbed to 50.6 in December from 50.2 in November, comfortably above the fifty-point threshold that distinguishes expansion from contraction and marking the most robust reading since mid-2024. Output increased for the third consecutive month, underpinned by stock building and efforts to clear backlogs of work, while new order intakes rose for the first time since September 2024, with burgeoning domestic demand the principal driver of the uptick.
The pace of expansion was, however, uneven across the sector; large manufacturers reported stronger growth in production and new work, while small and medium-sized enterprises continued to see softer conditions.
Employment remains a weak spot, with job losses recorded for the fourteenth straight month, though the rate of decline eased to its slowest in that period.
Firms also reported rising input costs, citing higher prices for materials and energy, and some pass-through to output prices after a period of relative price stability.
Export orders, while still in contraction, showed signs of stabilisation as the decline eased to one of the weakest rates in nearly four years.
Analysts noted that the recovery in UK factories coincided with receding headwinds from late-year budget uncertainty and the resumption of normal operations at major manufacturers following earlier disruptions.
While the headline data point to a tentative recovery in British manufacturing, confidence among producers remains cautious, with broader economic and geopolitical challenges continuing to temper sentiment.
Nonetheless, the December reading — the best in more than a year — suggests that the sector may be finding firmer ground as it transitions into 2026, buoyed by improving domestic conditions and a modest upturn in new order flows.
