Commercial construction at its highest rate since March, survey suggests

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23rd September 2015 16:57 - Construction

The latest figures from the Markit/CIPS UK Construction PMI Survey has revealed that commercial construction in the UK construction Commercial construction at its highest rate since March, survey suggestssector is at its highest level since March 2015.

The survey found that of the three sub-categories within construction, residential construction had experienced the fastest rate of expansion, whilst commercial construction experienced the most rapid pace of expansion.

The figures showed that the output index for August 2015 was 57.3, an increase from July’s 57.1 and much higher than the 50.0 score, which separates expansion from contraction.

Of the survey respondents, 53 per cent said that they expect an increase in business in the next 12 months. On the other hand, 5 per cent said they expect a fall.

Despite the level of optimism falling below June’s 11 year high, the latest readings were well above the survey’s average.

As well as this, the survey also discovered that sub-contractor charges have increased rapidly.

Global Corporates Managing Director for Construction at Lloyds Bank Commercial Banking, Stefan Friedhoff, said of the findings:

“Encouragingly, contractors are now far more selective in the way they bid for work, so although pipelines are healthy, firms are exercising restraint.

“In the long-term this should boost margins and, most importantly of all, ensure a more robust construction sector.

“The fundamentals in the industry are sound and this is fuelling a bullishness about potential output for the remainder of the year.”

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