Construction comes off the boil

A l a c k o f n e w wo r k h a s resulted in growth slowing across the UK’S construction industry.

The closely- watched I HS Markit / Ci ps c o ns t r uct i o n purchasing managers’ index ( PMI), released yesterday, revealed a reading of 54.6 for August, compared with 58.1 in July. Any reading above 50 denotes an expansion in business activity.

T i m Mo o r e , e c o n o mi c s director at survey compiler IHS Markit, said: “The latest PMI data signalled a setback for the UK construction sector as the speed of recovery lost momentum for the first time since t he reopening phase began in May.

“Housebuilding remained the best performing area of construction activit y, with strong growth helping to offset some of the weakness seen in commercial work and civil engineering activity.

“The main reason for the slowdown in total construct i on output growth was a reduced degree of catch- up on delayed projects and subsequent shortages of new work t o replace completed contracts in August.”

Housing a c t i v i t y underp i nned a ny g r ow t h, wi t h t he housebui l di ng s e c t o r reporting a reading of 60.7, compared with 52.5 for commercial activity and 46.6 for civil engineering. The report revealed that new business volumes i ncreased f or t he third consecutive month, but slowed sharply from July.

Gareth Belsham, director of property adviser Naismiths, said: “Quick, quick, slow – the construction sector is dancing a faltering foxtrot as new orders wobble but confidence steps up. Two months of meteoric j umps i n output were always going to be a hard act to follow, so few people will be surprised that overall momentum has eased back.

“While the decline in new orders is a serious concern, this latest PMI data still paints a picture of an industry that has dusted itself off and got back to work with gusto.”