EEF, a lobby group for engineering
and manufacturing employers, says a "rollercoaster of risks" is taking
its toll on UK manufacturing.
The group has slashed its 2015 forecast for manufacturing growth to 0.7% from 1.5%.
Volatile Chinese markets and the uncertain future of Greece in the EU are among the challenges facing industry, said the lobby.
Export orders have suffered as a consequence, it said in a report.
There
are two "important" exceptions to this trend, said EEF. Manufacturers'
investment and recruitment intentions are both looking up, with 6% more
firms planning to hire more workers during the next quarter and a
balance of 2% planning to increase investment.
'Turbulence and uncertainty'
Lee
Hopley, chief economist at EEF, said: "While UK data has continued to
point to solid growth, UK manufacturing is having to contend with a
rollercoaster of risks from the rest of the world.
"We've seen the
future of the Eurozone on the line once again, turbulence and
uncertainty over China and Greece and, of course, oil and gas are still a
concern," Ms Mopley added.
The forecast comes after a warning in September
from the International Monetary Fund that slower growth in China and
continuing stock market uncertainty pose a threat to global economic
growth.
The troubles in China have sent the prices of commodities such as oil and copper sliding.
'Cooling' confidence
In a separate report,
accountants KPMG said permanent job placements and billings for
temporary jobs both grew at the slowest rate in more than two years in
August.
While vacancies rose, the number of applicants declined,
leading to some increase in what employers were willing to pay, said
KPMG in their research.
And the Federation of Small Businesses (FSB) reported a "cooling" of confidence among their members.
"Lower
levels of confidence are reflected in more firms reporting a fall in
investment intentions this quarter, which have fallen from 26% 12 months
ago to 22% this quarter," it said.
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