Construction still badly affected by the recession

1 October 2009

02 October 2009 | Jake Kanter

Activity in the UK construction sector contracted at the fastest rate since June, scuppering any hopes of a swift recovery.

According to the latest CIPS/Markit Construction Purchasing Managers' Index - where a figure below 50 represents contraction - total activity in the sector registered 46.7 in September. It was lower than in August, when the industry registered 47.7.

There were severe declines in commercial and civil engineering activity, ending periods of slower contraction.

In contrast, housing activity rose to 50.3 in September, compared with 48.2 the month before. Although the growth was marginal, it signalled the end of 22 months of decline.

Employment activity fell to its lowest level in three months, while new orders and input prices also continued to decline.

CIPS chief executive David Noble said the construction sector remains badly affected by the recession. "Though the industry is not contracting as quickly as it was earlier in the year, firms are struggling to adjust to comparatively low levels of activity, as reflected by employment levels, which took another hefty hit and have dropped consecutively for 16 months," he said.

Further coverage of PMI reports is available at http://www.supplymanagement.com/EDIT/PMI/pmi.asp

SMoct2009

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