Buyers see bleak times ahead as output falls again

Grant Prior 10 years ago
Share

Construction buyers reported another fall in output last month as UK construction “remained rooted in contraction territory.”

The latest Markit/CIPS Construction Purchasing Managers’ Index edged-up to to 49.5 from 49 last time.

But any figure below 50 on the sentiment survey represents a fall in output and this was the first back-to-back sub-50 reading since the start of 2010.

David Noble, Chief Executive Officer at the Chartered Institute of Purchasing & Supply, said: “September’s figures show the construction sector’s cupboard to be well and truly bare, rounding off a disastrous quarter.

“After the longest continual decline in new orders for three years, this is of no surprise.

“Looking ahead, there is little to be positive about.

“Homebuilding continues to be hit hard, the commercial sector, so long the star of the industry, has lost its sparkle. That civil engineering has seen a moderate increase in activity, is scant consolation.

“This continued poor performance has been compounded by an increase in input prices reflecting rising cost pressures across the global economy.

“All of this, points to an ominous future. In the absence of investment of some kind, we are likely to see this level of activity continue for some time, or possibly even drop further.”

Tim Moore, Senior Economist at Markit and author of the Markit/CIPS Construction PMI, said: “UK Construction PMI data for September presents another bleak assessment of business conditions in the sector.

“The current stretch of falling new orders is now the longest seen for three years, reflecting shrinking underlying demand alongside delays in spending from both public and private sector sources.

“A lack of new projects meant that confidence in the business outlook remains close to its lowest since the UK economy nosedived into recession during 2008.

“An upturn in civil engineering output was overshadowed by downturns in house building and commercial activity during September, with the latter posting its weakest performance for around two-and-a-half years.

“While temporary factors such as the Olympics and an extra working day relative to Q2 somewhat cloud the interpretation of Q3 UK GDP, the principal take out from September’s PMI survey is that underlying construction weakness is likely to continue for the remainder of 2012.”

Latest news

Materials giant CRH looks to sell contractor Farrans

More than 550 staff set to get new owner
1 day ago

West Yorkshire transport projects delayed to save £270m

Over 30 transport schemes to be placed on hold due to cost inflation budget pressure
9 hours ago

Decision on A1 Costain dualling job delayed for third time

Development consent decision for £260m Northumberland scheme put back a further 9 months
10 hours ago

Colas wins £140m Cheshire highways upkeep deal

Incumbent contractor Ringway will handover to Colas in April
10 hours ago

Skanska to lend staff cash

Contractor links-up with finance firm to offer affordable loans to employees
10 hours ago

Ilke Homes pulls off £100m record-breaking fund raise

Largest-ever capital raise by a UK modular house builder to fund expansion
1 day ago

Construction buyers fear for year ahead

"Construction companies now have a tightrope to walk in terms of being ready for recovery and cautious around investment"
1 day ago

Gove calls for competition probe into house building

Levelling Up and Regeneration Bill 'strengthened' with new measures
1 day ago

Schools get £500m for energy upgrades this winter

Extra cash found for better heating controls, insulation and energy efficient lighting
1 day ago

1,000-home North London scheme approved

Developer Hill will start work in the Spring on South Tottenham site
1 day ago

Bid race for £500m Suffolk construction framework

Construction and building services firms called up for East of England four year deal
1 day ago

Mace employs robot dog to avoid slip and trips in tunnel

Robot working in dark and hazardous conditions under Heathrow Airport
1 day ago

Administrator details confirmed at Southampton M&E firm

Begbies Traynor now in charge at Working Environments as suppliers face large losses
2 days ago

Former Galliard chief takes helm at Inland Homes

New CEO Don O'Sullivan sets out to return south east house builder to profitability
1 day ago

Applicant numbers nosedive for construction vacancies

Recruitment market gets even more competitive - how the Enquirer can help
2 days ago

Industry veteran to head Henry Bros northern arm

Peter Commins, former Kier and Balfour Beatty northern chief, to spearhead growth drive
1 day ago

Housing association shuts in-house modular factories

Swan closes loss-making steel frame and cross-laminate timber factories
2 days ago

350-homes approved around iconic London Tube station

Housing blocks to be built around Grade II-listed Hounslow West Tube station
2 days ago

Domis set for £195m Boddingtons Brewery scheme

Developer Salboy buys Manchester site to kickstart long-awaited 556 homes project
2 days ago

John Lewis £500m funding deal to build 1,000 rental homes

Deal to advance BTR flats at store sites in Bromley, West Ealing and Reading
3 days ago

Esh launches new housing retrofit division

Esh Retrofit Solutions will target market to improve the energy performance of social rented homes
2 days ago

Eric Wright wins tricky £52m Liverpool transformation

Contractor working with engineers at Ridge and Partners on "challenging" Stanley Lock Flight site
5 days ago

Investment giant buys Bristol M&E contractor

RDCP Infrastructure acquires Avon Combined Electrical Services
5 days ago

Demolition start for £50m Farnworth town centre rebuild

Caddick Construction is tipped for main works due to start in the spring
5 days ago

L&G Modular strikes deal to build 1,000 affordable homes

Modular homes business teams up with Hampshire's Vivid housing association
5 days ago

Former Erith operations director joins John F Hunt

Scott Exell named new operations director at demolition specialist John F Hunt
6 days ago

Green light for £135m Leeds twin tower resi scheme

Construction to start in New Year on 500 build-to-rent apartments
6 days ago

Mace hits 1m tonnes carbon saving target for clients

Present work pipeline betters 2026 carbon emission saving target
6 days ago

Plans in for £40m surf park at former Kent colliery

Seahive surf lagoon and health resort will be built near Deal
6 days ago

Crushed demolition worker vows to return to industry

Shannon Brasier hoping to return to construction following horror accident
6 days ago

Contractor services