UK construction activity grew in October at its fastest monthly pace since autumn 2007, with the sector's workforce increasing at the fastest rate for six years, a survey shows.
The survey, which was published yesterday by the Chartered Institute of Purchasing and Supply and is adjusted to take account of seasonal factors, shows housebuilding continued to lead the recovery in construction sector output, amid state-backed schemes to boost the residential property market.
It also shows an acceleration in growth of activity in the commercial property construction and civil engineering sub-sectors.
CIPS's activity index for UK construction rose from 58.9 in September to 59.4 in October on a seasonally adjusted basis, moving above the August reading of 59.1.
At 59.4, the index is well above the level of 50 which is calculated to separate expansion from contraction and signals the fastest pace of increase in UK construction activity since September 2007.
According to CIPS's survey, the UK construction sector has grown for six consecutive months.
CIPS's employment index for the UK construction sector rose from 55.7 in September to 57.2 in October on a seasonally-adjusted basis.
Growth in housebuilding activity eased in October, but the pace of expansion in this sub-sector remained faster last month than that in the other two construction categories surveyed by CIPS.
Housebuilding continued to lead the sector's expansion, even though growth in civil engineering and commercial property construction activity accelerated last month.
CIPS's survey shows an acceleration of the pace of increase in new orders for the UK construction sector to a rate close to the recent peak in August. The October reading for new orders signalled the second-fastest pace of growth in 19 months.
Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "A very strong purchasing managers' survey October adds to the mounting evidence that a sustainable, robust upturn has now firmly taken root in the construction sector, following extended weakness.
"What is particularly encouraging, and bodes well for the sustainability of the upturn, is that the improvement in construction activity is now widespread across sectors, while incoming new business is elevated."
Tim Moore, senior economist at financial information company Markit and author of CIPS's construction sector survey, said: "UK construction output continues to rise like a phoenix from the ashes, with housing, commercial and civil engineering activity all seeing strong rates of expansion at the start of the fourth quarter."
Gross domestic product data published by the Office for National Statistics last month showed UK construction output grew by 2.5% quarter-on-quarter in the three months to September.
CIPS's survey shows that 52% of UK construction companies anticipate a rise in output over the year ahead, with only 12% expecting a reduction.
It signals UK construction companies last month increased their buying of materials at the fastest pace since December 2007.
Mr Moore said: "Improved opportunities to tender and a broadening of the recovery beyond housing activity have helped foster confidence in the longer-term outlook for business conditions... More than four times as many construction firms expect a rise in output over the year ahead as... anticipate a fall."
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