Construction contraction slows marginally

The UK construction industry continued to contract in April though the speed at which it did so slowed considerably, according to a new survey.

Civil engineering saw conditions ease the most, with housing and commercial sub-sectors also experiencing weaker falls in output than in previous months, according to the latest monthly report from the Chartered Institute of Purchasing & Supply (CIPS).

The headline seasonally adjusted CIPS/Markit UK Construction Purchasing Managers’ (PMI) Index rose sharply from 30.9 in March to 38.1 in April, though it still remains below its ‘neutral’ 50 level.

Respondents to the survey blamed ‘unfavourable market conditions, lacklustre demand and intense competition’ for the latest drop in new orders.

However, participants were more optimistic than they have been since last June, with most of them expecting business conditions to improve over the next year.

“The darkness that has been gathering across the UK construction economy over the past thirteen months lifted slightly in April but, against a backdrop of ongoing market uncertainty, fewer new orders and fierce competition, blue skies are still a fair way off,” said Roy Ayliffe, director at CIPS.

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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