Largest monthly rise of manufacturing output since April 2014

Posted on 10 Nov 2015 by Jonny Williamson

Manufacturing output for September 2015 increased by 0.8% compared with the previous month, according to the latest Index of Production figures from the Office for National Statistics.

The Office for National Statistics (ONS) estimates that the UK’s total production output increased 0.2% between Q2 (April to June) and Q3 (July to September).

Manufacturing, the largest component of production, is estimated to have fallen by 0.4% between the same periods, but increased when comparing September 2015 with the previous month.

This follows a slightly smaller increase of 0.4% in August 2015, and a decrease of 0.7% in July 2015.

The largest contribution to the quarterly growth came from mining & quarrying, which saw a 2.8% increase – the fourth consecutive quarterly rise since Q3 (July to September) 2014.

In the three months to September 2015, production and manufacturing were 9.3% and 6.4% respectively below their pre-downturn GDP peak in Q1 (January to March) 2008.

According to the ONS, the performance of the manufacturing industry has been more volatile than that of the Index of Production (IoP) as whole.

“Despite a moderate increase from July to August 2015 and a strong increase between August and September 2015, manufacturing output is only slightly above the level seen at the start of the year,” it said.

Lee Hopley, chief economist, EEF.
Lee Hopley, chief economist, EEF.

Commenting on today’s output and trade data, chief economist at EEF, Lee Hopley said: “While manufacturing contracted in the last quarter there are signs that some parts of industry were at least mounting a comeback after a summer lull.

“Together with the sharp rebound in October’s PMI, we may yet see some more positive data readings in the remainder of 2015, but the risks, reinforced in yesterday’s Inflation report, from weaker activity in emerging markets are likely to present some headwinds for manufacturers into next year.

“Indeed, another disappointing set of trade figures for manufacturing show that these effects are already being felt with a significant fall in goods exports to China over the past three months.”