THE UK construction sector eked out marginal growth in May, after six consecutive months of decline, a survey has shown.
Housebuilding drove the increase in overall construction activity recorded in the survey, which was published yesterday by the Chartered Institute of Purchasing and Supply and financial information company Markit.
The other two construction sub-sectors monitored by CIPS, civil engineering and commercial property construction, suffered further declines in activity in May, although their rates of contraction eased.
The slight rise in overall construction activity in May failed to bring an increase in employment in the sector.
CIPS's purchasing managers' index for construction, which measures activity in the sector, rose from 49.4 in April to 50.8 in May on a seasonally adjusted basis, moving above the level of 50 – calculated to separate expansion from contraction – for the first time since last October. The May reading is well adrift of the long-term survey average of 53.9.
The survey also shows a rise in new orders for the construction sector, albeit a marginal one, for the first time in a year.
The activity index for the housebuilding sub-sector jumped from 51.2 in April to 54.4 in May, to signal the fastest pace of increase since March 2011.
However, the construction employment index came in just below 50 for a third consecutive month in May.
David Noble, chief executive officer at CIPS, said: "The construction sector seems to have turned a corner after six dismal months. The improvement has been fuelled by a boom in housebuilding, but the sector remains bogged down by contractions in commercial construction and civil engineering."
He added: "The Government's attempts to boost housebuilding have given months of lacklustre growth a shot in the arm, but the continued decline in civil engineering can be largely attributed to the lack of public sector projects, which show no sign of increasing.
"This, coupled with poor performance in the commercial sector, means housebuilding alone is driving industry growth."
Howard Archer, chief UK economist at consultancy IHS Global Insight, highlighted the marginal rises in construction activity and new orders in May.
However, he said: "The construction sector is clearly still in a fragile state, and it is far from certain that it is now set for sustained improvement. "
He added: "It would be helpful for the overall economy if the construction sector just stopped contracting as it weighed down appreciably on GDP (gross domestic product) growth in 2012 and also in the first quarter of 2013, even though it only accounts for 6.8% of total output."
Tim Moore, senior economist at Markit and author of the construction survey, said: "UK construction output appears to have finally pulled out of a tailspin in May, but the latest figures suggest that the sector is worryingly reliant on residential building work for thrust."
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