January 2015
Featured in this insight: Construction, Financial services, Manufacturing, engineering & industrial
UK construction industry growth at its slowest rate for 17 months, December index shows: Although the UK construction sector has remained sturdy, in December the industry’s growth increased at its slowest rate for 17 months due to continual residential building.
The results, which were found in the Markit/CIPS Purchasing Managers’ Index (PMI), revealed that construction in the UK fell to 57.6 from 59.4 in November.
However, despite a noted slow in the sector, the index still maintains a score above 50, highlighting growth in the industry.
Despite residential building continuing to drive construction in the UK, it still grew at its slowest rate since June 2013.
It has been reported by Markit that pay may be starting to increase within the construction sector, with subcontractors’ pay increasing at a rate quicker than that of a record-high in November.
Perhaps supporting Markit’s claims, economists have forecasted a UK-wide increase in pay, the first since the financial crisis of 2008.
Some construction companies have claimed that the key area for growth, in 2015, is residential building.
Irrespective of the rate of residential building slowing, in December Markit claimed that 2014 was the best year for the sub-sector, since 1997.
The research also showed evidence pointing to an increase in demand for further residential development, and an increase in the amount of construction companies bidding for projects of a commercial focus.
Markit also reported that construction companies saw a notable increase in new business volumes, in December.
On the other hand, the sub-sector which showed the weakest performance, in December, was that of civil-engineering, which indicated a drop in output. This fall was the first civil engineering had seen since May 2013.
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