A SHARP slowdown in growth of housebuilding activity resulted in a deceleration of overall expansion in the UK construction sector in July, a survey has shown.

The Chartered Institute of Procurement & Supply found, in its latest monthly survey of the UK construction sector, that residential building activity had grown in July at its second-slowest monthly pace since June 2013.

In spite of this deceleration, housebuilding was again the fastest-expanding construction sub-sector in July.

CIPS’s purchasing managers’ index for the UK construction sector fell from 58.1 in June to 57.1 in July on a seasonally-adjusted basis. This reading, while well above the level of 50 deemed to separate expansion from contraction, was adrift of the average of 59.4 during the current sequence of sector growth that started in May 2013.

The July construction PMI reading, CIPS noted, signalled “a general growth slowdown from the peaks seen in 2014”.

The survey shows that growth of activity in the civil engineering sub-sector also slowed in July.

However, growth in commercial property construction activity accelerated to its fastest pace since March.

Meanwhile, the rate of growth of incoming new work for UK construction firms slowed in July.

The survey also shows sub-contractor charges rising at one of the fastest rates since the survey began in 1997.

Growth in the UK construction workforce slowed in July but remained much stronger than the long-run survey average.

Tim Moore, senior economist at Markit and author of the construction survey, said of the deceleration of the sector’s overall expansion: “July’s growth slowdown is the first for three months and perhaps a sign that the post-election impact on construction confidence has started to diminish.”

He added: “Residential activity expanded at one of the slowest rates for over two years, highlighting that the housebuilding sector is struggling to gain momentum despite supportive demand conditions.

“Survey respondents commented on a variety of growth constraints afflicting the residential building sector, including long lead-in times for new projects, scarce supplier capacity, skill shortages and stretched sub-contractor availability. Added to this, building costs rose at an accelerated pace in July and sub-contractor charges increased at one of the fastest rates since the survey began in 1997.”