UK private sector contracts again as the services slump deepens.
S&P Global Flash UK PMI®, June 2026 — Released 09:30 BST, 23 June 2026 · Data collected 11–19 June 2026
Composite at a 14-month low · services at a 41-month low · employment falling for a 21st straight month · the manufacturing bounce is stockpiling, not recovery
Key Points
●The UK Composite Output Index fell to 49.4 (May: 49.7), a 14-month low, signalling a second successive monthly fall in private-sector output.
●Services Business Activity dropped to 48.7 (May: 49.3), a 41-month low — activity is shrinking at its joint-sharpest pace since early 2021.
●The headline Manufacturing PMI eased to 53.1 (May: 53.9), but the Manufacturing Output Index rose to 53.6 (May: 52.2), its strongest since September 2024 — a divergence driven by stockpiling, not demand.
●New business fell at the fastest pace in 14 months, backlogs at the quickest in 7 months, and manufacturing new orders slowed to a six-month low.
●S&P Global says the survey is consistent with a 0.1% contraction in June and a broadly flat Q2 — a survey-based estimate, not an ONS figure.
49.4
Composite Output
June flash
▼ Down from 49.7 · 14-month low
48.7
Services Activity
June flash
▼ Down from 49.3 · 41-month low
53.1
Manufacturing PMI
June flash
▼ Down from 53.9 · still expansionary
53.6
Manufacturing Output
June flash
▲ Up from 52.2 · strongest since Sep 2024
Data Visualisation
Source: S&P Global Flash UK PMI® (23 Jun 2026). January–May from final monthly data; June from the flash estimate. The 50.0 line separates expansion from contraction.
Headline Indices — May (Final) vs June (Flash)
Index
May 2026 (Final)
June 2026 (Flash)
Composite Output
49.7
49.4
Services Business Activity
49.3
48.7
Manufacturing PMI
53.9
53.1
Manufacturing Output Index
52.2
53.6
Source: S&P Global Flash UK PMI®, June 2026. A reading above 50.0 signals expansion versus the prior month; below 50.0 signals contraction. The headline Manufacturing PMI and the Manufacturing Output Index are distinct measures: the PMI is a weighted composite of five sub-indices, while the Output Index tracks production volumes alone.
Commentary
The composite index has now spent a second successive month below the 50.0 line, and the weakness is concentrated exactly where the economy is most exposed: consumer-facing services, where activity is shrinking at its joint-sharpest pace since early 2021, alongside January 2023.
The manufacturing bounce is real but it is not a recovery — it is stockpiling. Firms are front-loading production ahead of anticipated price rises, and the survey itself flags that new order growth in manufacturing has already slowed to a six-month low. That cushion is thinning, not building.
The labour market tells the same story. Employment has now fallen for 21 consecutive months, new business is dropping at its fastest in over a year, and backlogs of work are being run down at the quickest pace in seven months. The output and jobs picture argues for caution, regardless of how the politics are framed.
GBTT Commentary
"A two-speed private sector — manufacturing propped up by temporary stock-building, services genuinely weakening — is an unstable combination, not a balanced one. The headline that 'manufacturing is holding up' is doing a lot of work it cannot sustain: the moment the front-loading effect fades, as the survey's own new-orders data says it will, the manufacturing offset weakens sharply and the composite is left exposed. Growth has stalled at precisely the point the public finances need it most. S&P's read — a 0.1% contraction in June and a flat second quarter — is survey-based, not an ONS outturn, but it is consistent with everything else we are seeing. If it is confirmed in the official data, a flat Q2 leaves the OBR's growth assumptions more exposed, and with them whatever fiscal headroom the Chancellor still claims to have."
— Damian Pudner, Senior Research Fellow, Great British Think Tank (GBTT)
Why This Matters
Growth has stalled where the public finances need it most
S&P Global's own read — a 0.1% contraction in June and a flat second quarter overall — is a survey-based estimate, not an ONS figure. But it is consistent with the broader pattern. If confirmed in the official data, a flat Q2 would leave the OBR's growth assumptions more exposed — and with them, the Chancellor's fiscal headroom.
The services slump is the real signal
Services make up roughly four-fifths of UK output. At 48.7 — a 41-month low — the sector is not softening, it is contracting. A manufacturing output reading of 53.6 cannot offset a services economy of that weight moving the other way.
The manufacturing strength is borrowed from the future
Output is rising because firms are building stock ahead of expected price increases, not because demand is recovering. New orders have already slowed to a six-month low. Stockpiling pulls activity forward; it does not create it. When the pull-forward ends, the give-back follows.
A 21st straight month of falling employment
The private sector has now shed staff for 21 consecutive months. A labour market contracting this persistently, against a backdrop of higher employment taxes, is the clearest evidence that the weakness is structural rather than a one-month wobble.
What This Means for the Economy
A two-speed private sector — manufacturing propped up by temporary stock-building, services genuinely weakening — is an unstable combination, not a balanced one. If the frontloading effect fades as the survey itself suggests, the manufacturing offset weakens sharply and the composite index looks exposed.
This is not the profile of an economy turning a corner. It is the profile of an economy borrowing momentum from one sector to disguise contraction in another. The Bank of England is left watching output weaken while the price pressures that drove the stockpiling remain in play — the same uncomfortable mix that has kept it from cutting.
Policy signal: the headline "manufacturing resilience" should not be read as recovery. The services contraction, the falling employment, and the thinning order books are the trend; the manufacturing bounce is the exception that is already fading.
Next Release
1 JUL 2026
S&P Global UK Manufacturing PMI — Final, June 2026
Confirms whether the manufacturing front-loading effect held or faded, as flagged in this flash release.
3 JUL 2026
S&P Global UK Services & Composite PMI — Final, June 2026
Final June data. Watch whether the services reading is revised and whether the second-month contraction is confirmed.
The composite index has now spent a second successive month below the 50.0 line, and the weakness is concentrated exactly where the economy is most exposed: consumer-facing services, where activity is shrinking at its joint-sharpest pace since early 2021, alongside January 2023.
The manufacturing bounce is real but it is not a recovery — it is stockpiling. Firms are front-loading production ahead of anticipated price rises, and the survey itself flags that new order growth in manufacturing has already slowed to a six-month low. That cushion is thinning, not building.
The labour market tells the same story. Employment has now fallen for 21 consecutive months, new business is dropping at its fastest in over a year, and backlogs of work are being run down at the quickest pace in seven months. The output and jobs picture argues for caution, regardless of how the politics are framed.