Building activity continues to grow

2 May 2006
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03 May 2006 | Anusha Bradley

UK construction activity remained strong in April and the industry was "highly optimistic" about the future, according to the CIPS Purchasing Managers' Index (PMI).

The overall PMI, in which an index above 50 indicates growth, recorded a reading of 53.7 - a slight fall from 54.7 in March.

The housing and commercial construction sectors both grew, with activity in the commercial sector accelerating to its fastest rate in five months. However, civil engineering activity continued to fall.

Volumes of new orders were up as a result of increased business enquiries and success in winning tenders. The new orders index posted a reading of 53.6, slightly weaker than March's reading of 56.5.

Input prices remained high, despite easing to a five-month low. The input prices index reading was 63.1, caused by higher prices for raw materials, fuel and energy.

Roy Ayliffe, director of professional practice at CIPS, said construction companies remained "highly optimistic" about winning future deals, despite high costs.

The future business index for April was 76.1 and respondents said they were confident recent gains in new business would continue over the coming months.

  • Coverage of previous months' PMI reports is available at www.supplymanagement.com/pmi


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