UK manufacturing expands for the first time in more than a year
1 December 2025 
The UK manufacturing sector has grown for the first time in more than a year, according to the latest S&P Global UK Manufacturing PMI (Purchasing Managers’ Index), which hit a 14-month high of 50.2 in November – the first time it has been in expansion territory (above 50) since September 2024. Domestic demand has strengthened, while the downturn in new export work has eased to a 12-month low. And, for first time in more than two years, factory gate selling prices have fallen.
Breaking down the data by company size suggests that while large firms increased their production volumes, SMEs experienced renewed downturns. Foreign demand declined for the 46th month in a row, with lower intakes of new business from clients in the US, EU, China and Brazil.
However, the outlook for the UK manufacturing sector continued to brighten. Business optimism rose to a nine-month high, with 56% of manufacturers reporting that they expect their output to be higher one year from now. Only 11% are anticipating a contraction.
Manufacturing job losses continued to mount for the 13th month running. These losses were linked to cost savings, the non-replacement of leavers, redundancies and recruitment freezes. Signs of excess capacity remain, as backlogs of work decreased at the quickest pace since April.
“November saw further signs of recovery in the UK manufacturing sector,” reports S&P Global Market Intelligence director, Rob Dobson. “The headline PMI is back in growth territory for the first time in over a year, with output up for a second month and the trend in new business stabilising following 13 months of continual decline. Business optimism has also continued its recovery, rising to a nine-month high.
“The numbers are especially encouraging as this improvement occurred despite November seeing elevated levels of business uncertainty, and in some cases an element of gloom, ahead of the Autumn Budget,” he adds.
“The lifting of this uncertainty caused by the long lead-in to the Chancellor’s budget announcement should hopefully provide a boost in December, but it will be interesting to see the extent to which business might react to the absence of any significant growth-promoting measures,” Dobson says. “After all, despite the improvement in the performance of the manufacturing sector, any growth is still worryingly weak.
In Europe, the German and French manufacturing PMIs both hit nine-month lows (at 48.2 and 47.8 respectively) with the manufacturing sectors in both countries still shrinking. By contrast, Ireland hit a four-month high (52.8), and the manufacturing economies of Greece (52.7), the Netherlands (51.8), Spain (51.5) and Italy (50.6) all expanded, albeit slowly.
Factory activity in the US continues to expand, with a November PMI of 52.2 (down from 52.5 in the previous month). But growth in demand slid as international trade continued to deteriorate.
“The health of the US manufacturing sector gets more worrying the more you scratch under the surface,” warns Chris Williamson, chief business economist at S&P Global Market Intelligence. “The main impetus comes from a strong rise in factory production, but growth in new order inflows slowed sharply, hinting at a marked weakening of demand growth.
“In short,” he adds, “manufacturers are making more goods, but often not finding buyers for these products. This combination of sustained robust production growth, alongside weaker than expected sales, led to a worryingly steep rise in unsold inventories… This unplanned accumulation of stock is usually a precursor to reduced production in the coming months.”
