British construction activity has seen the fastest output for almost six years in August, with residential construction remaining the strongest performing sector.
August data indicated another strong improvement in the overall performance of the UK construction sector, as highlighted by steep and accelerated expansions of both output and new business volumes. Construction companies also remain confident about the year-ahead outlook for business activity at their units, with around 46% of survey respondents expecting a rise and only 10% a reduction.
The headline Markit/CIPS UK Construction Purchasing Managers’ Index registered 59.1 in August, up from 57.0 in July and above the neural 50.0 value for the fourth consecutive month. The latest reading showed a sharp rise in total business activity and the fastest pace of output expansion in the construction sector since September 2007.
Tim Moore, the senior economist at Markit said: “The latest Construction PMI figures are an indication that the UK economy has performed impressively over the summer months. It seems highly likely that the construction sector will provide another positive contribution to UK GDP in the third quarter of 2013.”
Increased volumes of construction output indicate growth in all three broad areas of activity monitored by the August survey. The strongest performing sub-sector remained residential construction which has output rising at the fastest pace since June 2010. Acceleration in the rate of civil engineering activity growth appeared to be its strongest since September 2007. Meanwhile, commercial construction activity saw an increase at the most marked pace since May 2012.