16 Apr UK Construction PMI hangs onto growth
The Global/CIPS UK Construction PMI® for March read 50.7, slipping from 54.6 in February, but hanging on in the growth zone.
The continued rise in UK construction output was helped by a moderate increase in new orders. Civil engineering (52.0) saw the fastest rise in business activity. Commercial building work also increased (51.1), although the rate of increase eased from February’s nine-month high. House building was the weakest-performing area, with a sharp and accelerated decline to a 44.2 contraction reading. Lower volumes of residential building work have now been recorded for four months in a row.
Despite the weak residential performance the survey recorded a further increase in total new work received by construction companies – the second fastest rise since July 2022.
Greater workloads led to a solid upturn in staff recruitment, with the rate of job creation accelerating to its fastest since last October. That said, some construction firms noted that elevated wage pressures and shortages of available candidates had acted as a constraint on hiring.
Purchasing activity was broadly unchanged in March. Some construction companies suggested that improved supply conditions had encouraged them to run down inventories.
Input prices continued to rise sharply in March, attributed to elevated energy costs and rising wages. Cost inflation was, however, the second slowest since November 2020.
46% of respondents predict an increase in business activity during the next year; 11% expect a reduction. Optimism has rebounded strongly from the 2.5 year low in December, reflecting signs of a turnaround in client spending and more favourable UK economic outlook.