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UK construction growth slowed in February

UK CONSTRUCTION sector growth slowed in February, as the pace of increase of housebuilding activity decelerated, a survey has shown.

The Chartered Institute of Purchasing and Supply, which published the survey yesterday, said that reports from construction firms suggested that adverse weather conditions had contributed to softer growth in activity in February, particularly in the housebuilding sub-sector.

CIPS's construction activity index fell from 64.6 in January to 62.6 in February on a seasonally-adjusted basis. Although this indicated slowing growth, the index stayed well above the level of 50 deemed by CIPS to separate expansion from contraction and signalled rapid expansion.

The construction activity index has exceeded 50 in each month since May 2013.

And the pace of employment growth in the construction sector ticked up slightly in February, in spite of a sharp slowdown in the rate of increase in new orders. CIPS noted, although new order growth decelerated to its slowest pace for four months, it remained strong.

Construction employment has now grown for nine straight months. This is the longest run of workforce growth recorded by CIPS since the period between mid-2006 and early-2008, before the Great Recession.

Growth of activity in the civil engineering sub-sector accelerated in February.

CIPS said construction firms had noted greater spending by local authorities on capital projects and maintenance, in some cases in response to severe flooding and adverse weather conditions.

Housebuilding activity grew in February at its slowest pace for four months, although the rate of increase was still sharp.

And construction firms were upbeat about prospects for activity in the year ahead.

Survey author Tim Moore, senior economist at financial information company Markit, said: "While some froth has come off overall construction growth in February, the latest data showed that job creation picked up to a pace rarely seen since the summer of 2007. Moreover, there were six companies forecasting higher activity over the year ahead for every one anticipating a reduction."

Contextual targeting label: 
home improvement

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