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1 December 2011 | Adam Leach
Activity in the UK manufacturing
sector declined for the second month running as production stalled after
customers tightened the reins on spending.
The Markit/CIPS Manufacturing PMI
for November reported a figure of 47.6, the most severe decline in the sector
since June 2009. The report, which is based on responses from senior purchasing
managers, found that the drop in production was caused by reduced orders as clients
tightened the purse strings in response to weak economic conditions. New export
business also dropped as demand from Europe, the US and the comparatively
strong Asian market dropped.
According
to CIPS CEO David Noble, the sector is in for a gloomy period over the cold
months. “It looks like it’s going to be a bleak winter for UK manufacturers
with the PMI showing very little to be positive about at the moment. Export
orders, which UK manufacturers are increasingly dependent on, continue to
decline as the Eurozone crisis impacts demand in US and Asia as well as
Europe.”
The poor performance of the
sector over recent times (this was the third reported decline in four months)
was felt in the jobs market as companies cut staff and employment fell to its lowest
level since October 2009.
Rob Dobson, senior economist at
Markit, said: “The manufacturing engine has run out of steam…The lack of new
work is forcing manufacturers to rely on previously-placed orders to avoid
sharper cutbacks in output and employment. This cannot go on indefinitely and
job losses will inevitably mount if order books continue to weaken.”
