Confidence in construction rides high

2 February 2007
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02 February 2007 | Paul Snell

Confidence in the UK construction sector is at its strongest for 11 months, thanks to sharp activity and new order growth in January.

The CIPS construction purchasing managers' index (PMI) for January, where a figure above 50 indicates growth, recorded construction activity at 57.9, slightly better than December's figure of 57.5.

This activity boosted confidence in the sector, where future expectations reached a figure of 76.6, the most optimistic in 11 months. Companies were bouyed by expansion, increased site capacity and continued demand.

Housing activity continued to expand, recording a figure of 53.3, but was down compared with December's figure of 56.4. Commercial activity rose to 60.6 in January - the highest in three months - compared with 58.1 in December. Civil engineering, which reached 56.1 in December, its highest level in 37 months, was unnmoved.

New orders rose slightly in January, from 56.0 to 56.5, as did employment, up from 53.3 to 53.8. The increase in employment was attributed to the rise in construction activity and new orders.

Input prices also rose to the highest level since last July, reaching 72.5. This was as a result of steeper supplier charges and the increased price of raw materials including metals and concrete.

SMfeb2007

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