Report reveals slowdown in construction sector

Overall construction output was at its weakest in more than two years
Overall construction output was at its weakest in more than two years

Growth in Britain’s construction sector slowed to a seven-month low in November, hurt by the weakest rise in housing activity for two-and-a-half years.

The latest Markit/CIPS Purchasing Managers’ Index (PMI) survey for the sector gave a reading of 55.3 last month, down from 58.8 in October - a reading above 50 indicating growth.

It said housebuilding grew at its weakest rate since June 2013, while output in commercial construction and civil engineering also slowed.

The report added that building firms cited a slowdown in employment levels, new business as well as output.

The survey noted that aside from April’s pre-election slowdown, overall construction output was at its weakest in more than two years.

It comes after a disappointing CIPS/Markit purchasing managers’ index (PMI) survey on Tuesday, which showed t factory output had also eased to 52.7 in November, from 55.2 in October.

Markit senior economist Tim Moore said: “The UK construction recovery is down but not out, according to November’s survey data.”

However, the survey will be a blow to the Government, which said in September it plans to build one million homes in the next five years.

Mr Moore added: “Residential activity lost its position as the best performing sub-category, but a supportive policy backdrop should help prevent longer-term malaise.”

David Noble, CEO at the Chartered Institute of Procurement & Supply, said despite disappointment that last month’s strong activity had largely petered out, “the sector still operates in a positive environment of low interest rates, low inflation and lower commodity prices which has been reflected by respondents’ continued optimism for a good future.”