By Editor,John-Paul Ford Rojas

Copyright dailymail

The crisis in British industry has deepened after manufacturing suffered its biggest fall in five months and the slump plaguing the sector extended to a year.

The closely-watched purchasing managers’ index (PMI) of activity in UK factories fell to 46.2 in September from 47 in August – where 50 separates growth from contraction.

It was the 12th month in a row below 50, signalling that Britain’s factories have been in decline for a full year since October, when Rachel Reeves delivered her last Budget.

Employment numbers fell for the 11th month running and job losses ‘remained marked’, the survey found, with much of the blame laid on the Chancellor’s raid on employer National Insurance and increase in the minimum wage.

A downturn in new orders from clients was blamed on subdued confidence, US tariff uncertainty and higher costs both for energy and staff.

At the same time, the shutdown at Britain’s biggest car maker Jaguar Land Rover after a cyber attack has disrupted firms in JLR’s supply chain.

JLR said earlier this week that manufacturing would restart in the ‘coming days’ and workers were on standby to resume tomorrow, though this could stretch into next week.

The disruption at JLR is just one of a series of crises darkening the outlook for British industry – and creating a headache for the Government.

Elsewhere, relentless pressure on the steel sector has been added to by Donald Trump’s tariffs – prompting ministers to step in to rescue Scunthorpe-based British Steel.

Meanwhile, the Lindsey oil refinery in Lincolnshire fell into administration in June.

In Humberside, a key factory producing bioethanol – a component in motor fuels – has closed after Britain’s trade deal with the US opened the door to cheap American imports.

And in the North Sea, oil and gas bosses say 1,000 jobs a month are being lost as a painful ‘windfall tax’ on profits bites.

Rob Dobson, director at S&P global market intelligence, which compiled the PMI figures, said they represented ‘worrying news for the health of UK industry’.

He added: ‘Manufacturers are facing an increasingly challenging environment, with intakes of new business and levels of production hit by weak market sentiment, a dearth of new export work and a high cost environment exacerbated by tax and labour cost rises.

‘Companies entwined into the auto supply chain are also facing a temporary hit to activity following the cyber attack on JLR.

‘The tough operating environment is seeping through to business confidence, leading to an increased focus on cost cutting.’

Manufacturing accounts for about 9 per cent of the UK economy.

Mike Thornton, head of industrials at accounting firm RSM UK, said the figures suggested the sector was ‘showing a continued downward trend rather than a seasonal dip in August’.

He added: ‘Sustained contraction suggests manufacturers are scaling back operations to mitigate deteriorating market conditions with little sign of a rebound in the short term. So businesses should expect a stagnant outlook for the rest of the year.’

Elliott Jordan-Doak, senior UK economist at Pantheon Macroeconomics, said the latest PMI figures ‘paint a bleak picture’, adding: ‘The manufacturing PMI has been sending a consistent signal that sentiment remains weak in the sector, in contrast to the services industry where businesses remain more optimistic.’