UK Manufacturing PMI Climbs to Best Level Since August 2024

NeverVoteOnDAO · 2026-02-13T10:09:09+00:00

In January 2026, British manufacturing showed strong momentum with a PMI of 51.8, driven by a significant rise in new orders and a notable increase in export activity. However, employment remains a challenge and cost pressures are intensifying, impacting profitability.

NeverVoteOnDAO

2026-02-13 10:09:09

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British manufacturing entered 2026 with notable momentum, as the sector’s key health indicator surged to its strongest reading in recent months. The final manufacturing PMI for January reached 51.8, climbing from 50.6 the previous month and slightly exceeding the preliminary estimate of 51.6. This marks a significant turnaround compared to August 2024, when the sector was operating at lower confidence levels, signaling renewed economic optimism.

New Orders and Export Growth Power the Sector

The driving force behind January’s improvement came from a substantial rebound in new business activity. The new orders sub-index jumped to 53.2 from 50.2, representing the strongest performance since February 2022. More impressively, export orders expanded for the first time in four years, breaking a prolonged weakness in overseas demand that had weighed on manufacturers.

According to data from Jin10 and market intelligence from S&P Global Market Intelligence, this export growth reversal is particularly noteworthy. Rob Dobson, Director at S&P Global Market Intelligence, highlighted the shift: “UK manufacturing has started 2026 on a solid footing, showing encouraging resilience. The rebound in business confidence to its highest level since the autumn 2024 budget signals growing optimism among factory managers about near-term prospects.”

Employment and Cost Pressures Present Mixed Picture

While optimism has returned, the employment landscape remains challenging. Manufacturing employment continued its downward trend in January, though the rate of decline was the slowest recorded since employment taxes were raised in October 2024. This suggests that companies, while cautious about headcount, are beginning to stabilize their workforce reductions.

On the cost front, input price pressures intensified, reaching their highest level since August 2025. Rising material costs and supply chain expenses continue to pressure manufacturer margins, even as demand conditions improve. This cost-price squeeze remains a concern for the sector’s profitability outlook despite the positive momentum in order flow since August 2024.

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