UK manufacturing PMI revised higher but remains at 2023-lows

The S&P Global UK Manufacturing PMI for March 2025 was revised up to 44.9 from an initial estimate of 44.6. Despite the upward revision, it remained the lowest reading in 17 months, down from 46.9 in February, signaling a deepening downturn in the sector.

UK manufacturing PMI revised higher but remains at 2023-lows

The persistent contraction in manufacturing activity reflected an accelerated decline in both output and new orders, as businesses continued to face significant challenges in the operating environment. Manufacturers cited multiple headwinds weighing on the sector. According to Rob Dobson, Director at S&P Global Market Intelligence, companies are being affected by a combination of weakening domestic demand, rising costs, and global uncertainties. Many firms reported that market conditions in the UK were deteriorating, while cost pressures increased due to changes in the national minimum wage and national insurance contributions. Additionally, geopolitical tensions and the risk of global trade disruptions from potential tariffs further exacerbated the challenges faced by manufacturers.

Business sentiment hit by deteriorating conditions

The deteriorating conditions also took a toll on business sentiment, with confidence among manufacturers slumping to its lowest level in nearly two and a half years. Growing concerns over government policies, cost inflation, geopolitical instability, and trade policy uncertainty contributed to a more pessimistic outlook for both current operations and future growth prospects. As a result, businesses remained cautious about investment and hiring decisions, adding to the broader economic uncertainty in the UK manufacturing sector.