Construction activity sees further decline

1 October 2008
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02 October 2008 | Jake Kanter

Activity in the construction sector continued to decline last month, and at a faster rate than in August.

According to the latest CIPS/Markit Purchasing Managers' Index for construction, where a figure below 50 represents contraction, activity in the sector recorded 38.8 in September. Activity in August registered 40.5, and was at a record low of 36.7 in July.

The overall contraction was matched by declining activity in the housing sector, which fell to 26.1. This compares with 27.2 the month before. The sector has now been below 50 since December 2007.

Commercial activity fell to its lowest level in the survey's history, shrinking to 36.4, down from 40.3 in August. Global financial and economic conditions were blamed for the decline.

Civil engineering activity bucked the downward trend slightly, still contracting, but at a slower rate than in August. Activity registered 49, compared with 48.2 the month before, but was still well below the 12-month average of 57.4.

New orders also continued to fall, recording 41.2 in September, compared with 42.6 the month before. Staff levels registered 42.3, contracting at a record speed from August's figure of 47. Employers were not replacing the staff made redundant.

Input prices continued to soften, falling from August's figure of 76.7 to reach 69.5. It signalled a slowdown in inflation, even though prices still remained high.

Further coverage of PMI reports is available at


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