UK Construction Industry in a Strong Position, Survey Shows
14th July 2014 12:12 - Construction
The UK construction industry showed a strong rebound from May’s disappointing figures in June, according to the Markit/CIPS UK Construction Purchasing Managers’ Index (PMI).
June’s PMI reached 62.6 – 2.6 points higher than May’s figure, which was a seven-month low. The industry’s PMI has now been above 50.0 – which signals no change – for 14 consecutive months.
House-building was the best performing sector, incurring its steepest rise since January. Rising house prices, low interest rates and strong demand are factors thought to have encouraged this.
Elsewhere, commercial building also marked a steep rise – its sharpest in five months. The survey’s respondents put this down to the country’s improving economic conditions and greater confidence in terms of business outlook.
Civil engineering, however, displayed a “softened” output growth in June – its least marked growth since September last year. Many have linked this sector’s dampened growth to flood work completion.
Furthermore, UK construction companies benefitted from increased volumes of new work in June – the industry’s steepest rise in projects since January. As a result, employment has risen at its sharpest level in the survey’s 17-year history.
Despite companies remaining confident about the year ahead, positive sentiment dropped to a six-month low last month. Increased risk of interest rate rises over the next 12 months was cited as a possible reason for this.
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