Construction output growth hits 10 month low in February
February saw growth in construction output fall to it’s lowest level since April last year.
Jobs growth has also fallen to a two and a half year low with residential building work the weakest performing category of activity according to the report from the Chartered Institute of Procurement and Supply.
For the first time since January 2013, residential building was the worst performing sub-category of construction output. Moreover, the latest rise in housing activity was the slowest recorded since June 2013.
Tim Moore, Senior Economist at Markit and author of the Markit/CIPS Construction PMI®, said: “UK construction firms remained in expansion mode during February, but a loss of momentum within the residential building sector meant that overall output growth was the weakest since April 2015. Aside from the pre-election slowdown last year, the latest upturn in construction output was the weakest for over-two and-a-half years.
“Survey respondents noted that underlying business conditions remained favourable, especially in relation to commercial building and infrastructure-related work, but some clients had been hesitant to commit to new projects so far in 2016. Reflecting this, new order growth weakened again and construction firms were the least optimistic about their year-ahead growth prospects since December 2014.
“What’s different this time around is that construction companies have cut back on employment growth in response to the uncertain business outlook. Net job creation eased to its lowest since August 2013, which contrasted with the robust hiring patterns seen throughout last year.”