Construction activity remains slow

Adam Leach is a freelance business journalist
2 May 2013

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Activity in UK construction continued its decline in April with the sector now having experienced contraction for six months.

The Markit/CIPS UK Construction PMI recorded a figure of 49.4 for the month, up from 47.2 in March, but below the neutral point of 50, indicating a drop in overall activity in the market. There was a significant drop-off in civil engineering work, commercial activity dropped for the third successive month, but residential construction bucked the trend and rose.

New business volumes stretched to 11 months of persistently falling, though the rate of decline was narrow. Employment was broadly unchanged, with respondents indicating that uncertainty about the future had led to hesitance over hiring. Buying was down, largely due to the fall in new business. Sentiment among the firms remained subdued, but only slightly lower than in March.

Tim Moore, senior economist at Markit, said: “UK construction sector output was closer to stabilisation than at any time since October 2012, according to the latest survey data. A slower decrease in output reflected an element of catch-up after some severe weather delays earlier in the year.”

CIPS CEO David Noble said: “The UK’s construction sector showed signs of stabilisation in April, as it recorded its slowest decline in six months. This is a reasonable signal that things are a bit better in the industry but that said, construction is still contracting and witnessing marginal declines in new orders.”

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