Construction Output falls to Lowest Level since October 2009

06 - 03 - 2013

The construction industry will be looking to Chancellor George Osborne’s Budget on 20 March for measures to help prevent further decline in the sector, as construction activity plunged to its lowest levels in three years in February.

The purchasing managers’ index for the construction industry, compiled by Markit and the Chartered Institute of Purchasing and Supply (CIPS), fell to 46.8, compared with 48.7 in the previous two months. It was the lowest the index has been since October 2009. The index has been below 50 – a score that denotes contraction – for the past four months.

Commenting on the report, David Noble, Chief Executive Officer at the Chartered Institute of Purchasing & Supply, said: ‘There is barely a crumb of comfort in this month’s figures for the construction industry to ease the continued decline in performance.’

The fall in construction output reflected a decline in commercial building work and a sharp decrease in civil engineering activity. This drop offset the ‘marginal’ increase in residential house-building activity for the first time since May 2012.
Tim Moore, Senior Economist at Markit and author of the Markit/CIPS Construction PMI said: ‘The only exception to the overall output trend was a stabilisation in residential construction, with eight months of sustained decline ending in February. Moreover, construction companies cited new house building projects as an area having some potential to boost.’

David Noble added that ‘all eyes will be on the Chancellor to do something to prevent further decline in the sector as we approach the Budget later in the month.’






Foremans LLP Umberlla
Foremans LLP