UK Manufacturing Slows Sharply: What This Means for Exporters

UK manufacturing contracted at its fastest pace in five months in September 2025, with the S&P Global Purchasing Managers’ Index (PMI) falling to 46.2 from August’s 47.0. This signals a notable slowdown, as any reading below 50 indicates contraction. For exporters, this is more than a statistic it reflects shifting challenges that could directly impact competitiveness and supply chain resilience.

Weak demand both at home and abroad is squeezing production levels. At the same time, rising costs and digital vulnerabilities are intensifying pressures. A high‑profile cyberattack at Jaguar Land Rover illustrates the growing risk to manufacturing operations in an increasingly connected world. While input cost inflation has slowed, margins remain under strain, and staffing levels have been cut for the eleventh consecutive month, partly due to rising social security contributions and higher minimum wages.

For exporters, these trends matter. Lower production volumes could affect delivery times and the ability to meet overseas contracts, while cost pressures may influence pricing strategies. A weaker pound offers some advantage by making British goods more competitive abroad, but exporters must weigh this against rising costs and operational risks.

All eyes will now be on the UK Government’s November budget. Exporters will be hoping for targeted measures to support manufacturing and strengthen the UK’s trade position. For those looking to navigate this uncertain climate, diversification of markets and investment in resilience particularly in digital infrastructure will be key.

Source: Reuters