Confidence wobbles among purchasing managers

Grant Prior 11 years ago
Share

Confidence levels among construction purchasing managers started to wobble last month as a major market indicator took a dip in June.

Latest results for the Markit/CIPS UK Construction PMI index showed a June figure of 53.6 compared to 54 in May.

Any reading above 50 represents a rise in activity and the index posted growth for the sixth month in succession.

But confidence levels weakened sharply among purchasing professionals from May’s 12 month high to sink to their lowest point since December.

Sarah Bingham, Economist at Markit and author of the UK Construction PMI said: “June data rounds off a further solid quarter of growth, albeit down on the first quarter. This contrasts with the surprising weakness seen in the official data for the first three months of the year.

“The contraction in residential construction provides further evidence to highlight the weakness of the household sector in recent months, with the sluggish property market linked to high unemployment, job insecurity and worries about the fragile economic recovery in general.

“More optimistically, commercial construction held up well, suggesting that companies continue to invest in new built assets, and civil engineering even showed a nice rebound from a lull seen in May.

“The worry is that the level of business confidence has fallen to a six-month low in the sector, which suggests that companies are expecting growth to weaken over the next twelve months.

“That is perhaps not altogether surprising given a marked easing in the rate of expansion of new business inflows in June.”

David Noble, Chief Executive Officer at the Chartered Institute of Purchasing & Supply, said: “Growth in the UK construction sector was broadly unchanged in June, despite reaching a milestone sixth month of expansion.

“Optimism about increases in activity was stifled by concern over the overall health of the economy and the level of both public and private sector spending.

“Civil engineering activity had a slight reprieve after a notable contraction in May, but commercial activity – still the strongest area of growth – slowed somewhat.

“Meanwhile a reduction in residential construction was recorded, unsurprising given reports of sliding house prices. However, this was modest with almost three quarters of firms reporting no change.

“A solid reduction in employment indicated that firms are meticulously managing their costs, and prospects for any future expansions in output growth look moderate at best with confidence weakening.”

Latest news

Worker killed on £683m waste power plant site

Fatal collision involving heavy good vehicle on giant north London site
2 hours ago

Go-ahead for £200m lithium refinery on Teesside

Work to start next year on Europe's first lithium hydroxide processing plant
17 hours ago

HS2 agency workers paid the wrong wages

Payroll software problems leave workers out of pocket
17 hours ago

Electric car whizz joins O’Rourke

Contractor looking to learn tech lessons from other sectors
17 hours ago

Electrical contractors still confident despite staff shortages

Order books healthy but worries grow over margins
15 hours ago

BAM to deliver £44m Yeovil College campus build

BAM will submit a planning application next month to start work later next year
18 hours ago

Bouygues starts London 700-home council estate rebuild

Developer Linkcity seals financial close on Old Kent Road Tustin Estate job
18 hours ago

Construction’s “Leading Lights” recognised

Full details of latest winners of Considerate Constructor Scheme's latest awards
18 hours ago

ISG wins £600m Hertfordshire Hollywood film studio job

Holywood studio Sunset awards pre-construction contract for 90-acre studio complex in Broxbourne
4 days ago

NAO calls for road programme cuts as costs soar

Public spending watchdog calls for roads programme review amid project delays and cost overruns
4 days ago

Kier hires Laing O’Rourke veteran for London office push

Gus Wright takes up new London regional director role in January
4 days ago

VolkerFitzpatrick lands starring role on £174m film studios

Contractor to start main works on Eastbrook Studios in Dagenham
5 days ago

Wates poaches Balfour director to lead North West operation

Sarah Cooke to lead Wates Construction in the North West
4 days ago

£3.4bn Sellafield infrastructure race delayed to New Year

Contest to start in January for four partners in infrastructure delivery shake-up
4 days ago

Rebuilt TBM launches into second HS2 tunnel drive

Balfour Beatty Vinci TBM Dorothy starts second Long Itchingwood HS2 drive
5 days ago

Materials lead times back to pre-pandemic levels

Pinch points around gas boilers to persist until mid-2023 because of shortages of semiconductors
5 days ago

Bond strength helps TClarke towards £500m turnover target

Building services giant predicting a record year in 2023
5 days ago

All-clear for £125m Guildford Debenhams redevelopment

Native Land's St. Mary’s Wharf will comprise 185 homes
5 days ago

Thompsons brings down historic Redcar blast furnace – video

Redcar demolition clears the way for new net zero future
5 days ago

Wolverhampton picks McLaughlin & Harvey for £50m learning campus

Main construction to start next spring on City Learning Quarter
6 days ago

Michelmersh buys offsite brick cladding and chimney maker

Pre-built brick products producer Fabspeed sold for over £6m
5 days ago

Pagabo acquires mental health monitoring business

Framework giant makes move after Moodbeam goes into liquidation
5 days ago

Green light for London timber office block

Construction to start next year on six-storey cross-laminated timber block
6 days ago

Government pushes ahead with £3bn building safety levy plan

Affordable homes projects and small schemes developed by SMEs will be exempted
6 days ago

Rejigged £340m Museum of London plan approved

McAlpine tipped to take £340m job for new museum at Smithfield market
6 days ago

Ex-construction minister joins cladding repair firm

Intelligent FS appoints Lord Richard Harrington after government contracts send turnover surging
6 days ago

Willmott Dixon limbers up for £18m Rainham sports centre

Work to start in April on New Splashes Sports Centre in Rainham
6 days ago

Plans in for BBC’s new home in Birmingham

Project will be one of the first net zero carbon in construction office buildings
6 days ago

McLaughlin & Harvey wins Lowestoft harbour design

Lowestoft Eastern Energy Facility is expected to cost around £25m to build
7 days ago

Van Elle first-half revenue hits record £81m

Piling specialist upgrades full-year profit forecast after strong first-half trading
7 days ago

Contractor services