Housing leads way in November construction boom

2 December 2003
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02 December 2003 | Gareth Mytton

Activity grew strongly in all areas of the UK building industry in November, according to the latest PMI figures, with demand for housing keeping builders busy.

The construction purchasing managers' index (PMI) - a composite indicator of business activity from CIPS and NTC Research - rose to 60.5, well above the 50 figure that indicates no chance on the previous month and signalling the fastest expansion since June 2001.

More than 42 per cent of house builders said activity had risen over the month. The sector index climbed to 58.9 to show the fastest expansion since April 1997.

The growth in commercial activity decelerated marginally, at 57.5, but improved business confidence in the wider economy still led to more work. Growth in civil engineering picked up slightly (56.1).

The rate of growth in new business slowed slightly (59.2), although companies said clients were more willing to commit to new contracts. Businesses also took on more staff to meet current and anticipated orders.

Purchasing activity also increased to meet rising workloads, as did the use of subcontractors. Their rates rose slightly, as companies reported contractors were less available than in October.

Input price inflation, at 62, reached an 11-month high thanks to raw materials shortages and rising oil prices.

SMdec2003

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