Residential building shows strongest growth
New research has indicated that residential building showed the strongest construction sector growth during July.
According to the report from HIS Markit and CIPS UK Construction PMI, last month saw residential building outperform commercial construction and civil engineering activity, despite the most recent increase occurring at the slowest pace in three months.
A general slowdown in growth was reported by most construction companies in July, mirroring the reduced volume of commercial building and declining pace of housing activity. The research also indicated that new business volumes had fallen for the first time since August of last year.
Commenting on the results of the report Sarah McMonagle. The Director of External Affairs at the Federation of Master Builders highlighted factors which could be causing the market slowdown, stating: “These figures represent the weakest monthly performance in the UK construction industry for almost one year. Construction companies are suffering from ever-increasing costs and this is starting to act as a drag on growth. More specifically, the increase in construction material prices and higher wages and salaries due to the construction skills shortages will no doubt have contributed to these disappointing results. The commercial sector in particular fell at its fastest pace for 12 months but we also saw a loss of pace among house builders. However, although the construction sector is growing at a slower pace, it is still growing and therefore there is no reason to panic.”