Commercial building output increased in December at the fastest rate since 2007, strengthening hopes that the recent improvements in industry fortunes are broadening significantly and job prospects are brightening.
Most respondents to the Markit/CIPS UK Construction Purchasing Managers Index survey – 57% - say they are positive about the outlook for 2014 as strong output rises were recorded in the three broad areas of activity surveyed – commercial, housebuilding and civil engineering. Sharp rises were in output, new orders and employment.
The Purchasing Managers Index was down slightly from the previous month’s peak but showed an eighth successive month of output growth. Growth in housebuilding was more subdued than previously but remains the fastest growing of the three areas of activity and civil engineering maintained its growth rate. Commercial building however showed the sharpest improvement.
Markit senior economist Tim Moore said: “The latest survey highlights that construction companies enter 2014 with the wind in their sails. Most encouragingly, the improving UK economic outlook is helping boost private sector spending patterns, meaning that the construction recovery has started to broaden out from housing demand and infrastructure projects to include strong growth in commercial building work.”
Some 57% of survey respondents expect output to increase in 2014, compared to only about a third of firms at the same time last year. Mr Moore added: “Stronger growth expectations and fuller order books are continuing to fuel job creation in the construction sector. Higher employment numbers have now been reported for seven successive months, and these efforts to meet a sudden turnaround in UK construction demand should help keep staffing levels moving strongly upwards into 2014.”
Graph: Markit/CIPS
