UK Manufacturing Output , May 2023:  Data published by the Office for National Statistics (ONS) last week showed that manufacturing output fell by -0.2% compared to April but thanks to a strong month in March, output in the latest 3 months (March to May 2023) was +0.8% higher than in the previous period (December 2022, January and February 2023), although it was still -1.0% lower than a year earlier (March to May 2022).  Manufacturing output in May 2023 was 100.8% of its pre-pandemic level (February 2020 for the monthly data.

Using the rolling 3-month periods, output of the capital goods industries increased by +2.5% comparing the latest period with the previous one and +3.5% higher than a year earlier.  In the first of these comparisons, only consumer durables did better and capital goods has the strongest improvement compared to a year earlier among the major sub-groups.  Output of capital goods in May 2023 was 101.3% of its pre-pandemic level.

This improvement was largely due to the automotive industry where output in the latest 3 months was +7.1% higher than in the previous period and +3.9% above the level of a year earlier;  however, it is coming from a low base having been hit particularly by the shortage of components and in May 2023 output was still only 78.5% of its pre-pandemic level – the weakest of the industries on this measure that we cover in this review.

There was also a good performance by the metal products industry where output in the latest 3 months grew by +4.6%, although in this case it was only +0.1% higher than the same period last year.  However, the recovery is also on-going in this industry and the May 2023 output figure was 90.3% of its pre-pandemic level.

There was a more modest improvement in the aerospace industry where output in the latest 3 months was +1.0% higher than in the previous period and +1.8% above the level of a year ago.  This is also the first of our industries where output is above the pre-pandemic level with output in May 2023 at 101.6% of the February 2020 level.

Finally, the machinery industry is the weakest of our key customers at the moment with output in the latest 3 months down by -1.0% compared to the previous block and -3.2% down on a year ago.  However, thanks to an exceptionally strong recovery in the immediate aftermath of the pandemic, the May 2023 output figure is 106.9% of its pre-pandemic level.

You can download the ONS Statistical Bulletin from their web-site at (13 July) or request it from MTA;  we also have an analysis of the key industries which is available to members – please contact Geoff Noon ([email protected]) if you would like these charts.


UK GDP, May 2023:  With the release of the monthly output data, the ONS gives it estimate of monthly GDP.  The May figure shows a contraction of -0.1%, with the cumulative trend over the past 3 months being flat.

Against a generally flat trend, the main reason for the marginally negative reading was the extra Bank Holiday as a result of the King’s coronation.  Based on recent months when there was an extra Bank Holiday (June 2022 for the Platinum Jubilee and September 2022 for the Queen’s funeral), a more significant negative had been expected.  In turn, this was the main driver of a forecast of a negative quarter for GDP but this less bad outcome for May suggests that we may now get away with the 2nd quarter GDP figure being flat or marginally positive.  This outcome depends on the exact impact of strikes in the NHS on the output estimates for health sector.

We have already noted the picture for manufacturing and there was also a month-on-month fall of -0.2% for the construction sector thanks to a decline in new work – repair & maintenance activity was unchanged.  Over the latest 3 months, construction output was +0.2% higher than in the previous period and +2.1% higher than a year earlier.

Output of the service sector of the economy was unchanged from April;  this was also the picture for the 3-months ending in May compared to the same period up to February.  Activity in the consumer-facing parts of the sector was down by -0.2% both month-on month and for the latest 3-month block.  The largest contributions to this came from food & beverage service and real estate buying, selling & renting.

Elsewhere in the service sector, the largest increase in output was in human health & social work, mainly thanks to a lack of strikes by Junior Doctors in May, compared to 4 days of action the previous month.  The improvements were offset by declines in activity for wholesale trade (excluding motor vehicles), employment agencies and accommodation & food services that we have already mentioned.

There are more details in the range of ONS Statistical Bulletins which can be downloaded from their website at (13 July) or on request from MTA.


European Industrial Production, May 2023:  Eurostat also published the output data last week, although the aggregate they quote is for Industrial Production (IP) – while this is dominated by manufacturing, it also includes energy and utilities (but not construction).  Total IP was +0.1% higher than in April for the EU and up by +0.2% for the Euro-zone.  Compared to a year earlier (May 2022), the latest figure represents a fall of -1.8% for the EU and -2.2% in the Euro-zone.

There is good news in the breakdown by sub-sector, with output of the capital goods industries group leading the way with an increase of +1.0% for both the EU and the Euro-zone compared to April 2023.  Looking back to May 2022, only one industry group has a positive trend and, again, it is capital goods leading the way;  output was up by +3.5% for the EU and +2.5% for the Euro-zone.

Staying with the 12-month comparison, of the 26 Member States who have published the data (Cyprus is missing as usual), total IP increased in 10 and fell in 16 (this compares with 11 and 15 respectively for April 2023).  The most significant reductions were in Ireland (-16.2% – this had the strongest growth in the April figures, suggesting a timing or seasonal adjustment issue either now or a year ago), Estonia (-12.8%) and Bulgaria (-11.0%);  the fastest growth was recorded in Malta (+12.2%) and Denmark (+7.8%).

Among the largest EU economies, output in May 2023 was higher than a year earlier in France (+2.9%) and Germany (+0.9%) but fell in Italy (-3.7%) and Spain (-0.4%).

You can get the full details from the Eurostat News Release which can be downloaded from their website at (13 July) or requested from MTA.


USMTO and CTMR, May 2023:  The US Manufacturing Technology Orders (USMTO) programme tracks orders in the US market, based on the reports from participants.  In the first five months of the year, orders were -14.6% lower than in the same period of 2022 (January to May).  The 12-month rolling trend – effectively an annualised rate of change – showed a reduction of -17.7% on the level of the previous 12 months;  both of these are slightly worse than the figures for the period to the previous month (April) despite the May figures being higher.

The AMT Press Release notes a mixed picture by industry with job-shops running slightly above average;  otherwise, the main improvement came from those industries which are boosted by specific government policies – the construction sector is a good example which is providing an improvement in machine tool demand.

The data for the regional breakdown only covers metal cutting machines, but this is almost all of the value reported, so this is not a major issue.  The South-Central area is the only one in positive territory (+3%) and three others only have single digit downturns for orders in the first five months of the year – North-Central-East (-4%), North-East and North-Central-West (both -9%);  the large declines come in the South-East (-26%) and West (-37%) areas.

The US Cutting Tool Market Report (CTMR) tracks orders for tooling on a similar basis and in the first five months of 2023, orders are running +16.1% above the level of the same months last year.  The 12-month rolling trend is +13.8% higher than a year earlier and is at its highest since May 2020, although still a little below the pre-pandemic peak which occurred a year before that.

You can download the press releases for the two surveys from the AMT web-site at, with the CTMR release also published on the USCTI web-site at;  alternatively, you can request either or both releases from MTA and we can make sure you get them when they are published each month.

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