Thriving or Surviving? The Manufacturing Sector Health Check - February 2026

Now we’re settled into a new year for the manufacturing sector, it’s time to take a good look at how it’s faring compared to the wider UK economy, based on key data points we’ve pulled from the Office of National Statistics (ONS).

Let’s find out if the sector is surviving or thriving…

GDP (for December 2025)

The GDP for manufacturing is down by 0.6 points to 101.3. For the UK as a whole it rose by a tenth of a point to 102.6.

The three manufacturing sub-sectors that demonstrated the largest growth in the last month are:

• Manufacture of electrical equipment                        4.9%
• Air and spacecraft and related machinery               4.8%
• Manufacture of other transport equipment              4.8%

Employment and vacancies (for January 2026)

The figure for paid employees in manufacturing stood at 2.3 million according to figures published by the ONS last month, which represents a drop of 7,000 (0.3%) on the previous figure.

The number of UK employees dropped 11,000 to 30.28 million. That’s a decrease of 0.03% on last month’s stats which we collated in ‘Thriving or Surviving?’.

Manufacturing vacancies rose once again – in January the increase was 1,000 (1.96%) to 52,000. Vacancies in the UK as a whole dropped by 10,000 (1.36%) in the same period.

Wages and payroll (for December 2025)

Manufacturing mean pay reversed the drop we saw in the previous report, increasing by 0.22% (£8). Mean pay for the UK economy taken as a whole also grew, with an increase close to 1%.

UK aggregate pay increased by 1% to £103.3bn per month, while the manufacturing sector also saw an increase, albeit a smaller one of 0.07% to £8.51bn.

Exports and production (for December 2025)

Exports increased by 4.6% in December, capping off a few months of back-and-forth ups and downs.

The three manufacturing sub-sectors which displayed the largest export growth in December were:

• Manufacture of wearing apparel                                                                    45.9%
• Manufacture of printing and reproduction of recorded media                    39.2%
• Manufacture of furniture                                                                                38.8%

UK production values (for December 2025)

The three sectors which recorded the largest percentage of production value growth in December were:

• Repair and maintenance of aircraft and spacecraft                                         50.0%
• Processing and preserving of meat and production of meat products          19.7%
• Manufacture of computer, electronic & optical products                                19.0%

Meanwhile, the three sectors showing the largest decrease in production value were:

• Manufacture of wood and paper products, and printing                                          -26.8%
• Other manufacturing                                                                                                   -26.4%
• Manufacture of paints, varnishes and similar coatings, printing ink and mastics  -24.2%

Our take on the latest ONS data

Manufacturing GDP fell slightly, dropping 0.6 points to 101.3 in December, while the wider UK economy edged up 0.1 points to 102.6. This modest divergence reinforces the idea that manufacturing is stabilising rather than accelerating.      

Employment in manufacturing declined again, falling by 7,000 (‑0.3%) in January to 2.3 million, which represents a faster proportional drop than the one experienced by UK overall (‑0.03%).

Yet vacancies rose by 1,000 (+1.96%) to 52,000, in contrast to the UK’s 10,000 reduction. This combination of headcount down, vacancies up continues to signal the churn we’ve previously reported on. It means firms are still cautious on permanent staffing but they’re willing to hire selectively for those hard‑to‑fill or strategically important roles.

Exports delivered a strong December uplift of 4.6%, underscoring external demand as a key short‑term support factor.

Although manufacturing is not yet thriving, the latest data points toward stabilisation, with momentum clustered in specific high‑value areas. The centre of gravity remains cautious but improving – we’re seeing survival with flashes of resilience.

What’s your view on the latest data? Is the sector Thriving or Surviving? Check out the latest developments on our LinkedIn page.

Enginuity on LinkedIn