The latest Markit/CIPS survey has found that UK construction companies have continued to record strong output rises during April, with all three broad categories of activity registering robust growth.
However, the overall rate of expansion was found to have eased since March and was the least marked for six months,dipping from 62.5 to 60.8 in April. The latest reading was much higher than the 50.0 no-change threshold and well above the long run survey average (54.3). Higher levels of construction output have now been recorded for 12 months running.
Residential construction was the best performing broad area of activity, and the rate of expansion in April remained one of the fastest seen over the past 10 years. On top of that, the current 15 month period of continuous house building growth is the longest since 2006/07.
The latest survey pointed to a steep and accelerated rise in new business received by UK construction companies, with the pace of expansion the fastest since January. Survey respondents noted a range of positive influences on new business volumes, particularly increased numbers of new housing starts, higher levels of public sector infrastructure spending and improving underlying economic conditions.
April data pointed to a steep rise in construction sector employment, which extended the current period of job creation to 11 months. Increased payroll numbers were widely attributed to greater output requirements and confidence about the outlook for business activity. The latest survey indicated that construction firms’ confidence regarding the business outlook was only slightly lower than the seven-year high posted in March. Around 10 times as many construction companies (56%) anticipate a rise in output as those that forecast a fall over the next 12 months (5%).
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