Despite July being quieter, the overall bullishness continues in the Markit/CIPS UK report
The seasonally adjusted Markit/CIPS UK Construction Purchasing Managers’ Index(PMI) registered 62.4 in July, down slightly from 62.6 in June but above the neutral 50.0 mark for the fifteenth successive month.
The latest expansion of overall construction activity was one of the fastest seen since the summer of 2007. Anecdotal evidence widely cited resurgent demand for construction projects, especially in the housing sector.
July data has signalled the steepest rise in residential building activity since November 2003, which survey respondents attributed to favourable funding conditions and strong demand for new housing starts. Civil engineering activity also expanded at a sharper pace in July, but commercial construction increased at a slower rate than one month previously.
Higher levels of construction output were supported by a further steep improvement in new business intakes during July. New orders have increased in each month since May 2013, and survey respondents linked the latest expansion to favourable domestic economic conditions and greater confidence among clients.
The rate of job creation across the construction sector was the fastest since the survey began in April 1997. Anecdotal evidence attributed rising payrolls numbers to increased workloads and ongoing efforts to boost capacity. In some cases, survey respondents noted that staffing levels had been increased in response to concerns about sub-contractor availability. The latest survey indicated a reduction in sub-contractor availability for the thirteenth month running, while rates charged by sub-contractors increased at a near-survey record pace.
Caption UK construction still continues to show encouraging growth.