Britain’s manufacturing sector recorded a pointy rebound in the third quarter (Q3) of 2025, pushed by stronger exports and pent-up funding demand, in line with Make UK/BDO’s Q3 Manufacturing Outlook survey.
Britain’s manufacturing rebounded in Q3, led by export growth and pent-up funding demand.
Output rose to +25 per cent, orders to +16 per cent, and funding intentions to +25 per cent.
Vacancies price ~$5.4 billion yearly.
Costs stay a fear, with over half of corporations elevating costs.
Output remains to be forecast to fall in 2025 and 2026.
Recruitment intentions have risen, however the sector’s 46,000 unfilled vacancies are costing £4 billion (~$5.4 billion) in misplaced output yearly.
The survey confirmed all indicators improved after a string of weak quarters, with export growth significantly sturdy. The US regained its place because the second most favoured marketplace for growth, after dropping out of the highest three in Q2 on account of tariff uncertainty.
The stability on output rose to +25 per cent from +9 per cent in the final quarter, with complete orders climbing to +16 per cent from -2 per cent in Q2. Export orders once more drove growth, rising to +23 per cent from +7 per cent, whereas UK orders rebounded to +12 per cent from -1 per cent final quarter, in line with the survey.
Recruitment intentions improved sharply to +15 per cent from +1 per cent (-3 per cent in Q1), and funding intentions jumped to +25 per cent from +2 per cent, indicating a launch of pent-up funding demand. The Q1 stability was equally weak at simply +5 per cent. Nearly 70 per cent of corporations mentioned they plan to speculate in know-how and automation, signalling a concentrate on long-term productiveness beneficial properties.
“After a period of considerable uncertainty in global markets, these figures are an encouraging sign that manufacturers’ confidence is improving and, more importantly, being translated into growth and investment. However, one swallow doesn’t make a summer, and with UK and European markets in particular remaining anaemic it wouldn’t take much to knock prospects for further growth,” Stephen Phipson, chief govt at Make UKmentioned.
“These latest findings offer a glimmer of hope for the manufacturing sector. Despite what has been a relentless year by all accounts, manufacturers have somehow boosted their output and doubled down on their investments to match,” mentioned Richard Austin, head of Manufacturing at BDO.
However, rising prices stay a priority. Nearly 70 per cent of corporations count on price will increase in the upcoming Budget, whereas 68 per cent report prices have already exceeded expectations in the final six months. Over half of producers have already raised costs this yr, with an extra 53 per cent planning to take action in the subsequent six months, retaining inflationary pressures alive.
Despite the constructive momentum, Make UK cautioned towards assuming a sustained restoration, forecasting sector output to contract by 0.1 per cent in 2025 and 0.6 per cent in 2026.
“Government has made great strides in backing manufacturing with its industrial strategy and it must avoid imposing any further cost burdens which will hamper its number one mission of boosting economic growth,” Phipson cautioned.
“The spectre of the upcoming Budget looms and the sector will need robust signalling from the government that their investments are worth the risk. All eyes will be on the Autumn Budget and it’s vital that the government seizes this opportunity to prove their commitment to the sector and to the promises made in the Industrial Strategy,” Austin confused.
Fibre2Fashion News Desk (HU)