Latest data released by Markit - 1 September 2021
The preliminary report can be found here. The details show that supply constraints have led to slower production growth in August, although firms are still showing much resilience as output, new orders and employment still posted solid gains on the month.
Markit notes that:
"Severe disruptions to supply chains and raw material shortages eroded the growth momentum of UK manufacturing in August.
"Although solid gains in output and new orders were achieved, companies reported that production, delivery and distribution schedules were experiencing substantial delays.
"A wide range of factors contributed to the disruption, including port capacity issues, international shipping delays, the re-imposition of COVID restrictions at some key points in global supply networks and ongoing issues post-Brexit. With all of these factors likely to persist for the foreseeable future, manufacturing could well see a further growth slowdown in the coming months.
"The impact of supply issues is also feeding through to rapid price inflation. Rates of increase in both input costs and selling prices remained close to record highs in August, as rising demand chased constrained supply and companies moved to pass on price increases to clients and consumers alike. This is affecting most markets, but especially autos, metals, food stuffs and electronics.
"Business confidence remained elevated despite the widespread shortages as firms focused on the longer-term outlook and brought back furloughed workers. However, the solid jobs growth seen in August could soon wane if supply disruptions and shortages of both labour and required skills continue to worsen."
