Construction recovery takes a knock in June

Date: 05 Jul 2017

Construction buyers have reported a slowdown in growth in June due mainly to renewed client caution and falling orders.

Softer growth momentum was recorded across all three broad areas of construction activity. Residential building continued to outperform commercial work and civil engineering in June.

The latest Markit/CIPS UK Construction Purchasing Managers’ Index slipped from 56 in May to 54.8 in June.

Reports from survey respondents suggested that a lack of new work to replace completed projects had weighed on construction growth in June.

Mirroring the trend for new business, construction companies  also reported the slowest rise in employment numbers for three months.

Tim Moore, Senior Economist at IHS Markit and author of the Markit/CIPS Construction PMI® , said: “The construction sector experienced a growth slowdown in June, largely reflecting weaker rises in commercial building and civil engineering activity.

“Residential construction work continued to increase at one of the fastest rates since the end of 2015.”

He added: “Survey respondents commented on renewed caution among clients, in response to heightened political and economic uncertainty.

“Fragile business sentiment led to delayed decision-making on large projects and greater concern about the outlook for workloads during the next 12 months.

“While construction firms remain upbeat overall about their near-term growth prospects, the degree of confidence fell to its lowest so far this year.”

Duncan Brock, Director of Customer Relationships at the Chartered Institute of Procurement & Supply, said: “While new business wins were less in evidence, demand for materials remained high as suppliers scrabbled to meet the need for a number of materials in short supply and their performance worsened as their delivery times lengthened.

“With some doubt edging into the psyche of the construction industry about positive trading conditions, the sector will be guarding against continuing higher input prices with another eye on the possibility of rising interest rates as well.”


Image 1 Blog
A Guide to Finding Quantity Surveyor Jobs in London
21 Jul 2023
TOP 10 SKILLS 1 Blog
Top 10 Skills That Construction Recruiters Look for in Candidates in 2023
24 May 2023
Site Engineer Job Interview Blog
Site Engineer Jobs: 7 Ways to Make an Impression During the Interview
28 Apr 2023