However, such a decline in manufacturing is contradicted by the latest EEF/BDO manufacturing outlook report that showed more that a quarter of manufacturers reported increased output during the past three months.
The PMI index showed that the sector dropped to 49.0, representative of a 26-month low on a scale where figures below 50 indicate contraction.
According to the PMI, companies' input costs continued to rise while the prices charged largely remained static or rose only minimally.
The index decline came as new export orders experienced the most significant decline in five years with overseas demand falling.
This coincided with a major fall in growth in the services sector, which dropped from 55.4 in July to 51.1 last month, the second-biggest fall on record.
However, this jars with the EEF/BDO's findings and feedback from UK printers.
Of the 200-plus manufacturers surveyed, output grew 27% during the period while new orders were up 23%. Just under 50% said that they are expecting a moderate increase in capacity with nearly 12% anticipating a major increase.
Companies such as direct mail business Loricas Solutions and digital printer FE Burman, said domestic trading increased during August following a poor July but remained cautious.
"We have not yet turned the corner as year on year trading figures continue to decline," said Loricas Solutions chief executive Howard Matthews.
In addition, companies have been largely unable to pass ongoing price rises in paper and paper products onto customers.
Matthew said: "Increases in paper and paper products continue to rise and I do not envisage input costs will remain static during the next 12 month or beyond."
He added: We are constantly being benchmarked against our competitors and unfortunately those placing their print work are under pressure to go for the cheapest quotation.
"Although some longstanding clients have remained loyal, they are becoming more and more price conscious than I can ever remember.
"There is no doubt the print industry will continue to experience difficult times during the next three years at least. We must learn to be more creative, offering our clients and prospects a complete solution for their marketing campaigns otherwise I fear for our partners in the industry. Challenging times ahead."
FE Burman managing director Michael Burman said increased paper costs have only been passed on during shorter-run jobs where paper is a smaller proportion of the overall cost.
