4 August 2009 | Jake Kanter
Activity in the UK building industry contracted at its slowest rate in 16 months, with commercial and civil engineering work both showing improvements, according to the latest CIPS/Markit UK Construction Purchasing Managers' Index.
In July the PMI recorded 47 - where a figure below 50 represents contraction - compared with 44.5 the month before.
Activity in the commercial and civil engineering sub sectors improved but remained below the 50 mark. Housing contracted at a faster rate, falling to 44.1 last month, compared with 45.4 in June.
The level of new orders and staff numbers also continued to decline, but at a slightly slower rate than in June. Input prices remained low, while future business expectations were still soaring.
CIPS chief executive David Noble said: "Optimism is returning to the UK construction sector on the back of a perceived improvement in economic conditions. Although the current situation still looks very bleak, an upturn looks much closer than it did a few months ago. However, times are still tough as steep competition and difficult market conditions pushed the sector into its 17th month of retrenchment."