Home / News / Construction output momentum eases

Construction output momentum eases

There was a sharp rise in UK construction output in May, but the pace of expansion is the slowest since October 2013.

Construction output momentum eases

The seasonally adjusted Markit/CIPS UK Construction Purchasing Managers’ Index (PMI) fell from 60.8 in April to 60.0 in May, above the 50.0 no-change level for the thirteenth successive month.

House building remained the strongest performing area of activity, while civil engineering output increased at a robust rate that was faster than in April.

The latest survey pointed to another steep increase in demand for construction materials, with input buying rising at the fastest pace for three months.

Supplier lead times lengthened markedly in May, with survey respondents widely noting shortages of stock and supply-chain bottlenecks.

Tim Moore, senior economist at Markit and author of the Markit/CIPS Construction PMI, said:

“Output growth hit a seven-month low in May, but the UK construction sector is enjoying its strongest overall phase of expansion since the summer of 2007. Residential building remains a key engine of growth, with survey respondents citing another surge in new house building starts during May.

“The latest survey highlights that the construction sector is now experiencing its longest period of job creation for six years. Strengthening demand for construction staff arrived amidst the fastest drop in sub-contractor availability since August 1997, which in turn contributed to a survey-record rise in sub-contractor charges in May.

“UK construction output is still around 10% lower than its pre-crisis peak, but there were further indications of capacity strains in May as companies reported sharply lengthening delivery times for raw materials as well as the steepest drop in the availability of sub-contractors for almost 17 years.”

About Fiona Russell-Horne

Fiona Russell-Horne
Group Managing Editor across the BMJ portfolio.

Check Also

Chandlers opens new London rapid response roofing branch

Chandlers Roofing Supplies is opening its tenth specialist roofing supplies branch, in Tottenham, London, this …