UK construction sector growth weakest since 2013

Will Green is news editor of Supply Management
4 April 2016

The UK construction sector is experiencing its weakest growth phase since the summer of 2013, according to a survey of buyers.

The Markit/CIPS UK Construction Purchasing Managers’ Index recorded 54.2 in March, unchanged since February but still showing expansion against the no-change reading of 50.

Faster rises in commercial and civil engineering activity were offset by another slowdown in residential building.

Survey data showed the weakest rise in new work received across the construction sector since April 2015, along with greater caution among construction firms in terms of staff hiring.

Supplier delivery times lengthened in March but input cost inflation moderated for the second month running to its weakest since February 2010.

David Noble, group CEO, CIPS, said: “Though activity and new work slowed, construction firms enjoyed the slowest rate of cost increases for just over six years, largely due to ongoing falls in commodity prices. There was evidently a loss of momentum in the sector, though cautious optimism was sustained as a result of encouraging domestic economic conditions, but against a background of some political uncertainty.”

Tim Moore, senior economist at Markit, said: “Heightened uncertainty about the business outlook appears to have weighed on overall construction demand so far in 2016, with survey respondents citing cautious client spending patterns and a reduced willingness to commit to new projects.”

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