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Helen Chandler-Wilde 02 August 2018 3:16pm BST House building has risen at the fastest rate since December 2015, and construction overall has grown at the fastest rate in over a year,
according to figures released today. The purchasing managers’ index (PMI) for construction in July was 55.8, up from 53.1 the month before. A figure over 50 signals growth. Although this is
still below the long-term average, it is the fastest increase since May 2017. IHS Markit, which puts together the reports, said that the uptick in the sector has been partly due to a
recovery from lows, but was also aided by improvements in underlying demand. Increases in house building led the sector, followed by less dramatic increases in commercial and civil building
The increase in output was accompanied by the fastest rise in employment since December 2015. It also squeezed supply chains, which led to the longest delivery times for a year. Input cost
pressures remained, but dipped from the nine-month high last month. Tim Moore, the author of the report described the numbers as an “impressive turnaround” in UK construction. “July data
reveal an impressive turnaround in the performance of the UK construction sector, with output growth the strongest for just over one year”, he said. “While the recent rebound in construction
work has been flattered by its recovery from a low base earlier in 2018, there are also signs that underlying demand conditions have picked up this summer.” Duncan Brock, group director at
the Chartered Institute of Procurement and Supply, said that building clients had “rekindled enthusiasm” after being “held back by uncertainty”. “Looking ahead, though optimism remains at
lower than average levels, with the biggest rise in job creation since December 2015, there’s some conviction that the future is brighter, at least in the short-term”, he said. “Bearing in
mind the sector has experienced a number of twists and turns over the last couple of years, we must all remain watchful for any return to uncertainty as Brexit approaches.”