Industry was partly boosted by the resumption of production at Jaguar Land Rover after the car giant’s factory shutdown, caused by a major cyber attack.
The S&P Global flash UK composite purchasing managers’ index (PMI) reported a reading of 51.1 in October, rising from 50.1 in September.
The flash figures are based on preliminary data. Any score above 50.0 indicates activity is growing while any score below means it is contracting.
October’s reading was slightly stronger than expected, with economists having predicted 50.7.
Experts indicated that the improvement in growth could suggest sentiment is becoming more positive across the economy.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said: “October’s flash UK PMI survey brings hope that September was a low point for the economy from which business conditions are starting to improve.
“Output has picked up, with a particularly welcome return to growth for manufacturing for the first time in over a year accompanied by an upturn in demand for services, notably among consumers.
“Business confidence has also brightened slightly, job losses have moderated, and inflationary pressures are coming back to levels consistent with the Bank of England’s 2% target.”
The research highlighted a slight improvement in activity in the services sector but surveyed firms said this was still “sluggish” in the face of subdued consumer sentiment and business caution ahead of the autumn budget.
Meanwhile, manufacturers reported the fastest upturn in production since September last year.
Firms said there were still some challenges related to the factory shutdown at JLR but others highlighted they had benefitted from the phased restart at the firm’s manufacturing sites.
October’s data also indicated that private sector job losses eased to the lowest level since May.
Cost inflation slowed for the second consecutive month, easing to its lowest level since last November.
