Civil work fuels construction growth
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Construction buyers reported the fastest growth for nearly two-and-half years in industry activity in September this was filed by the growth in Civil’s work this is helping bring the construction industry back out of the doldrums of the past year.
The S&P Global UK Construction Purchasing Managers’ Index (PMI) rose to 57.2 in September, up from 53.6 in August, marking the seventh consecutive month above the neutral 50.0 level.
This latest figure signals a strong surge in overall construction activity, marking the fastest rate of growth in 29 months.
Growth was recorded across all sectors, with civil engineering leading the way at 59. Contractors pointed to a boost in renewable energy infrastructure projects and an increase in major project work as key drivers.
Commercial construction also saw gains, with its index rising to 55.2 in September, the highest level of growth since May. Lower borrowing costs and stable domestic political conditions contributed to this increase.
The residential sector also picked up speed, with housebuilding at 54.3, the sharpest increase since March 2022, driven by improving market conditions and growing confidence.
Tim Moore, Economics Director at S&P Global Market Intelligence, commented: “UK construction companies reported a clear improvement in growth momentum during September, with faster gains across all three major sectors of activity.”
“A combination of lower interest rates, domestic economic stability and strong pipelines of infrastructure work have helped to boost order books in recent months.
“New project starts contributed to a moderate expansion of employment numbers and a faster rise in purchasing activity across the construction sector in September. However, greater demand for raw materials and the pass-through of higher wages by suppliers led to the steepest increase in input costs for 16 months.
“Business optimism edged down to the lowest since April, but remained much higher than the low point seen last October. Survey respondents cited rising sales enquires since the general election, as well as lower borrowing costs and the potential for stronger house building demand as factors supporting business activity expectations in September.
