Data from the Office for National Statistics (ONS) shows that manufacturing output declined by -1.0% in May; however, despite this being the 3rd consecutive decline (following -0.6% in April and -0.2% in March), the strong results for February (+2.4%) mean that production in the latest 3 months was +0.4% higher than in the previous 3 months and up by +0.5% compared to the same period in 2024.
In May, 9 of the 13 sub-sectors of manufacturing saw output lower than in April, with the largest contributions to this trend coming from “basic pharmaceutical products” (-4.2%), “transport equipment” (-1.3%) and “basic metals and metal products” (-1.8%). This was partly balanced by “machinery & equipment not elsewhere classified” (+3.4%) – see below. It is also worth noting that although “transport equipment” was weak in May, over the past three months it has made the largest contribution to growth in total manufacturing output.
In the rest of this note, we will use the 3-month rolling trends as they take out some of the noise in the monthly data. References to these periods will cover March to May 2025 as the latest 3 months, December 2024 to February 2025 as the previous period and “last year” is March to May 2024.
At the sub-sector level, output of the capital (or investment) goods industries was +1.2% higher than in the previous 3 months and +1.8% above the level of last year. On both comparisons, this is the strongest of the manufacturing sub-sectors.
This takes us back to our 4 key industries, where automotive and aerospace both fall within the wider “transport equipment” group and have different trends to report. Output of the automotive industry, as measured by the ONS data series (based on turnover of companies classified to the sector), grew in February and March, before falling back in April and May to leave output in the latest 3 months +2.1% higher than the previous period but -3.4% down on a year earlier.
Data published by SMMT on units of cars and engines produced paints a slightly different picture but this is not seasonally adjusted and with the short month of December still in the base line of the rolling 3-month trend, this is a source of difference to the ONS data which does adjust for seasonal effects. For the record, the number of cars produced in the latest 3 months was +11.3% higher than the previous period but -0.3% below the level of the same period in 2024; for engines, the growth rates were +11.7% and +0.8% respectively.
In contrast, aerospace output has grown in each of the past six months and in the latest 3-month period is up by +3.2% compared to the previous 3 months, with this consistent upward trend meaning that it is +1.4% higher than a year earlier.
We have already referred to the strong growth in the machinery industry where output in the latest 3 months is +2.9% higher than in the previous period and +6.9% up on a year ago. The weak point at this stage is the metal products industry, which is slightly surprising given its links to the machinery and transport equipment industries through sub-contract activity and the inclusion of the production of weapons & ammunition in this industry. Output in the latest 3 months has fallen by -3.6% over the previous period and -3.1% compared to a year ago.
You can download the ONS Statistical Bulletin from their web-site at https://www.ons.gov.uk/releasecalendar (11 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.