UK manufacturing activity lost momentum in June, although output was supported by businesses bringing forward orders ahead of expected price rises and supply chain disruption linked to tensions in the Middle East.
The latest S&P Global UK Manufacturing Purchasing Managers' Index fell to 52.5 from 53.9 in May, below the earlier flash estimate of 53.1, indicating a slower pace of growth across the sector.
John Bryant, head of manufacturing at MHA, said: "June’s PMI figures show a manufacturing sector still growing, but with momentum feeling more fragile as the index fell to 52.5. The recent uplift appears to have been temporary, driven in part by customers stockpiling ahead of expected price rises and disruption linked to the conflict in the Middle East. With new order growth now at a six-month low, there are clear signs that this boost is already fading.
“Similarly, employment growth is a positive signal, but it should be treated with caution. Some firms say recent hiring is a short-term response to stronger order books rather than evidence of lasting confidence.
“Manufacturers continue to face significant pressure. Energy costs remain a major challenge, cited as a key operational risk by 33% of firms in our latest MHA Manufacturing Report. Supply chains are also under strain. Our report shows supply chain disruption is now the sector’s biggest operational risk, cited by 35% of firms.
“Further pressures are also building. The introduction of US steel tariffs, the forthcoming Carbon Border Adjustment Mechanism and a new Prime Minister all point to more change and less stability. Manufacturers want certainty, but ongoing geopolitical tensions, supply chain disruption and a difficult economic backdrop do not create the conditions businesses need to plan, grow or invest.
“Despite this, manufacturers are not standing still. Our report shows that more than four in five manufacturers expect growth of at least 3% over the next year, while 26% expect growth above 5%. Many are also investing in technology, AI, IT systems and more diverse supply chains to build resilience.
“However, our report points to clear regional disparities, with manufacturers in different parts of the UK facing distinct pressures depending on their local skills base, infrastructure, supply chains and levels of digital adoption. This underlines the need for a more regional approach to industrial policy, with regional mayors playing a stronger role in directing support, funding and skills programmes towards the specific needs and strengths of their local manufacturing economies.
“The sector has clear ambition, but turning short-term growth into sustained recovery will depend on stronger demand, lower cost pressure and a more stable policy environment.”
Among its UK locations, accountancy and business advisory firm has offices in Aberdeen and Edinburgh.
2026 MHA Manufacturing Report:
https://www.mha.co.uk/spotlight-on/mha-manufacturing-report-2026