UK construction sector rebounds after 'Beast from the East'

  • May 04, 2018

Britain’s hard-pressed construction industry, which accounts for 6% of the economy, bounced back in April after heavy snow and a battering from the ‘beast from the east’ in March.

According to the Markit/CIPS UK Construction purchasing managers’ index (PMI) construction output activity rose at its fastest pace for five months, with residential house-building showing the strongest growth since May 2017.

The harsh winter weather led to a shutdown of building sites in March, and the index sunk to a 20 month low of 47.0. The PMI rose to 52.5 in April, and anything above 50 indicates expansion.

The report showed that demand in the sector remained subdued, and new work increased only marginally, although employment numbers rose for the 21st month in a row.

Tim Moore, associate director at HIS Markit, said: “A rebound in construction activity was pretty well inevitable after snowfall resulted in severe disruptions on site during March.”

“Housebuilding led the way, with growth in April among the strongest seen over the past two-and-a-half years. However, the picture was less positive in other areas of construction, with commercial building and civil engineering work rising only marginally,” he added.

Housebuilding drove the rebound during April and has been the bright spot for the industry. Housebuilding has been supported by the government’s Help-to-Buy equity loan scheme which subsidises purchase of newly built homes.

Commercial and civil engineering activity also increased during April, with a modest rate of growth, and sterling increased by 0.23%, ticking up to 1.364 after the readings were published.

David Lewis, managing director, integra people, warrington

 
 
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