UK construction shrinks as new work put on hold
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Construction output in the UK has officially slowed after inflationary pressures mount up with many small builders reporting that customers are putting works on hold because of ripples in the economy making them feel uneasy to commit extensions and alterations to their homes.
Although larger companies are still recruiting with many reporting lack in tradesmen and a vernal skills shortage throughout the sector but in general lower levels of domestic projects and cilia work are being reported in the S&P Global/CIPS construction purchasing managers’ index (PMI).
This is down slightly for construction scored 49.2 in August, up fractionally from 48.9 in July, and still below analysts consensus of 52 any number below 50 indicates a contraction in the opposite way signal growth.
With new orders growing at their weakest point since June 2020 and fears about the industry and the wider economy hit confidence.
Andrew Harker, economics director at S&P Global Market Intelligence commented saying that: “The UK construction sector looks set to be in for a challenging period, according to the latest PMI data.
“Not only did construction activity fall for the second month running, but a range of indicators from the survey pointed to further weakness ahead.
“New orders slowed to a crawl, while concerns about the sector and the wider economy led to a drop in confidence.”
Job creation also slowed but price pressures were their lowest since February last year which means that some materials have become cheaper due to demand falling and large suppliers of materials and construction companies bolstered their supply issues which softened price rises across the board.
The report concludes saying that “Recession concerns, the cost of living crisis and lower levels of consumer confidence were the most commonly cited factors affecting business expectations in July”
To read the full report please use this link
https://www.pmi.spglobal.com/Public/Home/PressRelease/18e38b512f3647c295e77d539721a495
