UK private sector activity expanded for a third consecutive month in September, although the pace of growth slowed as output growth moderated across both services and manufacturing, according to preliminary PMI survey data.
The S&P Global Flash UK Composite Output Index fell to 51.7 in September from 52.5 in August, its lowest reading for three months.
The Flash UK Services PMI Business Activity Index also declined to 51.7 from 52.5, while the Flash UK Manufacturing Output Index fell to 51.4 from 52.1, reaching a six-month low.
The headline Flash UK Manufacturing PMI, however, increased to 52.0 from 51.7 in August, its highest level for three months.
New Business Declines in September
Total new work across the UK private sector declined slightly in September, reversing the marginal increases recorded in July and August.
The reduction primarily reflected a renewed decline in new business at services companies.
Survey respondents cited lower business and consumer confidence, including pressure on discretionary spending, as factors affecting demand.
Export sales also declined, with the rate of contraction the fastest since June. Manufacturing companies recorded their first reduction in export orders since December 2025, with some respondents citing lower sales to customers in the European Union.
Input Price Inflation Accelerates
Input price inflation increased for a second consecutive month and reached its highest level since June.
Businesses participating in the survey reported increases in energy, fuel and raw material costs.
Prices charged by private sector companies also increased, with the rate of output price inflation reaching its highest level since June.
Employment Falls for 24th Consecutive Month
Private sector employment declined again in September, extending the period of continuous job losses to two years.
The reduction in employment was marginal and less pronounced than the average recorded during the first half of 2026.
Survey respondents cited higher operating costs, efficiency improvements and limited pressure on existing business capacity among the reasons for restrained hiring.
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said: “September is seeing a worrying combination of disappointingly sluggish economic growth and intensifying inflationary pressures, with subdued business confidence and high costs meanwhile continuing to discourage hiring.”
Williamson added: “Output growth across the manufacturing and services PMI surveys has slowed to a pace consistent with the economy growing at a mere 0.1% quarterly rate.”
Business Optimism Holds at Six-Month High
Overall business optimism was unchanged from August, when it reached a six-month high.
Confidence among manufacturers increased to its highest level since February, with survey participants citing planned project starts and increased investment spending on production capacity.
The flash PMI data were collected between 10 and 21 September.
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