Buyers see slowdown at start of the year

Grant Prior 9 years ago
Share

A slowdown in new order growth saw the latest construction buyers index slide to its lowest rate of expansion since last April.

Growth rates dipped last month
Growth rates dipped last month

The latest Markit/CIPS UK Construction PMI index dropped to 55 in January from 57.8 in December.

Softer new business growth was blamed for the fall but buyers are still confident about future prospects with 46% expecting a rise in work over the next 12 months compared with just 6% braced for a fall.

Tim Moore, Senior Economist at Markit and author of the  Markit/CIPS Construction PMI, said: “UK construction firms struggled for momentum at the start of this year, with heightened economic uncertainty acting as a brake on new orders and contributing to one  of the weakest rises in output levels since the summer of 2013 .

“Softer growth of house building activity and a more subdued increase in commercial construction were the main factors behind the slowdown.”

Max Jones, Global Corporates director for construction at Lloyds Bank Commercial Banking, said: “This PMI data is indicative of a construction sector which has endured a mixed start to the year.

“The sector is a highly domestic-focussed part of the UK economy but that does not mean it is immune to factors elsewhere in world.

“The start of 2016 has been marked by global market volatility which has negatively impacted sentiment among some of the industry’s larger, listed players.

“Businesses are thinking carefully about the potential impact of a vote in favour of Brexit, while another area of concern is the growing uncertainty surrounding several projects in the UK’s infrastructure pipeline.

“It is not all bad news, however. Anecdotal evidence suggests that the long-running skills shortage may be easing, while the weakening commodity prices which have contributed to the instability in global markets have reduced input prices for construction firms.

“At least in the short term, this tailwind – along with strong-looking order books – should help contractors in their ongoing attempts to improve operating margins.”

Latest news

Hill hits record £90m profit as homes pipeline swells

Build-to-rent push and £4.8bn contracting book to fuel next growth phase
14 hours ago

Rayner unveils £39bn plan to build 300,000 social homes

Council building revival and rent reform feature in social and affordable homes plan
21 hours ago

Keltbray bounces back with £3.2m profit

Tighter controls and smarter project selection fuel strong turnaround
21 hours ago

VINCI JV wins 500-home twin town centre revamps

Chester Northgate phase 2 and Northwich Weaver Square schemes move to delivery stage
21 hours ago

80 energy projects unlocked as Ofgem backs grid expansion

£24bn energy networks deal gets green light from regulator
2 days ago

How to see your stories on the Enquirer

Join our Suppliers and Buyers directory to get your news published
21 hours ago

Henley lands Midland Mill revamp on Leeds tower scheme

Restoration of 18th-century mill kicks off on South Bank regeneration project
21 hours ago

New boss at Eric Wright Civil Engineering

Gavin Hulme takes top job as Diane Bourne moves to group role
1 day ago

Pinewood submits £1bn data centre plan

Studio giant adds green and learning spaces to tech hub blueprint
2 days ago

Record results after TClarke goes private

Britain's biggest M&E contractor flourishes after de-listing
2 days ago

Dalkia lands £200m nuclear maintenance deal

1,000 nuclear FM staff to join M&E contractor
2 days ago

Construction comeback to outpace wider economy

Arcadis forecast fueled by spending review optimism
3 days ago

First steel goes up on giant car battery site

Severfield gets to work on McAlpine Somerset site
3 days ago

Permasteelisa wins cladding deal on Bovis city tower

Facade specialist lands package at 60 Gracechurch Street
2 days ago

Fox buys recycled asphalt specialist Fisher

Acquisition adds major recycled asphalt capacity in north west
3 days ago

Major Building Safety Regulator shake-up to end tower delays

HSE stripped of control and top fire chiefs brought in to fast-track stalled schemes
3 days ago

Hinkley trio sign Sizewell civils deal

Balfour,Bouygues and Laing O'Rourke form Civil Works Alliance for new power station
3 days ago

£3.9bn data centre plan for Ravenscraig steelworks

Green energy to power massive new steel to silicon AI campus
3 days ago

Breakthrough on HS2’s second longest tunnel

8.4 mile Northolt to Old Oak Common drive completes
3 days ago

Neilcott on fast-track to debt-free employee ownership

£22.5m loan nearly paid down after big profit year
3 days ago

TfL kicks off race for £700m Tube station upgrade

South Kensington and Elephant & Castle top the pipeline list
3 days ago

Corbyn Plant Hire fleet goes under the hammer

Kit to be sold off by sister firm to collapsed groundworks contractor
3 days ago

Government wields procurement stick on late payment

New rules would block slow payers from bidding on big public jobs
6 days ago

Hercules buys power line labour firm for £15.7m

Labour supply specialist snaps up Advantage NRG to tap booming electricity upgrade market
6 days ago

Universal bid to fast-track planning for theme park

Entertainment giant eyes 2026 start at Bedford site
6 days ago

Developer Breck to transform former Ibstock brick factory

Ravenhead works to become 300-home development
6 days ago

SP Energy Networks awards contracts worth £1.4bn

First round of awards under £5.4bn national electricity grid upgrade programme
7 days ago

Travelodge to convert Liverpool Street office building

Office-to-hotel conversion in City of London
6 days ago

Plans lodged for 1m sq ft City of London office

Barbican landmark building will reuse 40% of existing structure
7 days ago

PTSG acquires roofing specialist HD Sharman Group

Premier Technical Services Group expands building maintenance division
6 days ago