UK construction sector growth remained weak in May, as Brexit uncertainty continued to weigh and new orders fell, a survey has revealed.
And UK construction companies’ optimism about future growth prospects fell in May to its lowest level in seven months.
The Chartered Institute of Procurement & Supply’s latest purchasing managers’ index for UK construction, which measures activity in the sector, was unchanged at 52.5 in May. Although above the 50 no-change mark, this signals only a modest rate of expansion.
The latest survey points to a slowing of growth in the housebuilding and civil engineering sub-sectors in May. Growth of commercial property construction activity accelerated to its fastest pace for three months. Housebuilding remained the fastest-expanding UK construction sub-sector, even though its pace of growth eased from an 11-month high in April.
Sam Teague, economist at IHS Markit and author of the construction survey, said: “Activity in May was once again buoyed by some firms still catching up from disruptions caused by the unusually poor weather conditions in March, and a renewed drop in new work hinted that the recovery could prove short-lived.
“Inflows of new business slipped back into decline, signalling the resumption of the downward trend in demand seen during the opening quarter. Companies frequently noted Brexit uncertainty and fragile business confidence led clients to delay building decisions in May.”
Mr Teague added: “With new order books deteriorating and cost pressures picking back up, it’s not surprising to see construction firms taking a dimmer view of prospects and pulling back on hiring, all of which makes for a shaky-looking outlook.”
CIPS director Duncan Brock said: “The two millstones of uncertainty and weak economic growth gave the sector plenty to worry about this month. With a decline in new orders for a fourth time in five months, it was client hesitation and consumer diffidence towards spending that had construction activity stuttering."
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