Manufacturing activity held steady last month, with growth levels unchanged on November, latest figures showed.

The survey, by the Chartered Institute of Purchasing and Supply, showed the sector was still growing, although expansion remained subdued.

The CIPS Purchasing Managers' Index, based on a range of questions to manufacturers, was at 51.3 in December, unchanged on November's figure. On the index, a figure higher than 50 indicates growth, while below indicates contraction. But manufacturing output was up for the 21st month in a row, with December's growth rate the fastest for nine months as firms saw an overall modest strengthening in demand. The CIPS Output Index showed growth of 53.0, against 52.8 in November.

The overall rise in output reflected a modest acceleration in the rate of growth of new orders, said CIPS.

Order book volumes have also risen for 21 consecutive months, and growth - at 53.7 last month against 52.3 in November - was at its fastest pace for five months.

But CIPS said, despite the growth, firms were still struggling to win new business, particularly in overseas markets. Firms once again blamed poor export sales on the strength of the pound, although increasing numbers were citing slower economic growth in continental Europe and the US as a factor.

Employment levels continued to decline in December, reflecting a downward trend evident for the past three years. The CIPS Employment Index recorded 48.2 in December, compared with 49.1 in November as firms scaled back capacity in line with growing concerns about future demand, especially weaker growth in Europe and the US.

Roy Ayliffe, director of professional practice at CIPS, said: "Purchasing managers continued to bear down upon rising prices whilst maintaining a tight control of stocks due to uncertainty over order levels in the coming year."