º£½ÇÊÓƵ manufacturing has finally entered a growth phase for the first time in over a year, following months of challenges that have burdened the sector.
The S&P Global º£½ÇÊÓƵ Manufacturing Purchasing Managers' IndexTM (PMI) reached a 14-month high of 50.2 in November, an increase from 49.7 in October.
This puts the industry above the crucial 50 mark, which signifies whether a sector is expanding. The survey concluded just one day prior to Rachel Reeves presenting her Autumn Budget on 26 November.
Rob Dobson, director at S&P Global Market Intelligence, said: "It will be interesting to see the extent to which business might react to the absence of any significant growth-promoting measures.
"After all, despite the improvement in the performance of the manufacturing sector, any growth is still worryingly weak.", as reported by .
According to the PMI, November saw a "stabilisation in new business following a 13-month sequence of contraction".
Business optimism also rose to a nine-month high, with just over half of manufacturers predicting their output level to be higher in a year's time.
Dobson further added: "[A] combination of soft industrial performance and subsiding price pressures will add to the shift in policy debate away from inflation fears towards supporting economic growth."
The budget presented mixed results for manufacturers.
The industry was also impacted by the significant cyber attack on Jaguar Land Rover, which resulted in car production being cut by nearly 30 per cent in September.
Manufacturing at JLR was suspended for five weeks from 1st September, resulting in a £1.9bn impact.
Shortly before the Budget, the manufacturing sector urged the government to prioritise growth amid "existential threats."
Analysts cautioned that any upturn could prove "short-lived" if the government imposes additional burdens on businesses at the Autumn Budget.
The sector's trade body Make º£½ÇÊÓƵ said firms are concerned about further obligations and expenses from inheritance tax changes affecting family businesses, alongside the ramifications of the forthcoming Employment Rights Bill.
The government abandoned its controversial proposals to grant all new employees protection from unfair dismissal from their first day – which formed part of the Bill – following months of industry warnings about the workers' rights package and strong political opposition from the House of Lords.
Make º£½ÇÊÓƵ urged the government to commit to no additional national insurance increases and a targeted business rates exemption for investments in green technologies.
After the Budget, Stephen Phipson, chief executive of Make º£½ÇÊÓƵ, said: "The Chancellor should also be commended for her personal intervention to kick start the consultation on the business energy support scheme which is vital if we are to address the º£½ÇÊÓƵ's eye watering and uncompetitive industrial energy prices."
But he added: "On the downside, however, restricting tax relief on salary sacrifice and, a further increase in the National Living Wage mean that manufacturers are again facing greater barriers to successful recruitment and retention of skilled staff...
"The Government came to power promising that growth was going to be its number one mission and, while it was dealt poor cards, we have yet to see any significant upswing in our economic performance and productivity."
