• Strong PMI survey boosts hopes of private sector-led recovery
• Eurozone and China manufacturing also improved

UK manufacturing experienced an unexpected surge in November to record its fastest growth for 16 years, according to fresh data which indicates that the sector is staging a healthy recovery from the recession.

The surge in manufacturing boosted hopes of a revival in the private sector, and comes as separate surveys today suggesting strengthening manufacturing sectors across the eurozone and also in China.

The Markit/CIPS manufacturing Purchasing Managers’ Index rose to 58 in November. Any number above 50 signifies monthly growth rather than contraction, and the figure is the highest the index has been since September 1994. The hiring part of the index was particularly strong, showing that manufacturers took on staff at their fastest rate since the survey began 18 years ago.

“With the economy having created 343,000 private sector jobs in the first half of 2010, and added another 167,000 in the third quarter, the surge in the employment component of today’s PMI to an all-time high is very good news,” James Knightley at ING said. “When combined with robust readings of the Bank of England agents’ summary surveys on hiring intentions we are increasingly confident that the job losses resulting from fiscal austerity can be more than fully offset by private sector growth.”

Backlogs of work increased for the first time in five months, the data revealed, while new orders rose at their fastest pace since April. Rising prices increased cost pressures, while output prices fell to an eight-month low.

Howard Archer of IHS Global Insight said the strong figures might encourage the Bank of England to hold off on further quantitative easing: “This is an extremely encouraging report and, for now at least, the manufacturing sector is holding up very well. Not only does the sector look likely to see strong expansion in the fourth quarter but the forward-looking indicators point to healthy growth early in 2011.”

The strong figures came amid further encouraging manufacturing data in both the eurozone and China. Eurozone manufacturing activity picked up for a second successive month in November. The eurozone PMI improved to a four-month high of 55.3 in November from 54.6 in October and 53.7 in September. Meanwhile China’s Purchasing Managers Index rose to 55.2 in November from 54.7 in October.

Manufacturing accounts for about 13% of UK GDP.

Business: Manufacturing sector | guardian.co.uk