The rate of expansion of construction activity has dropped for the second month in a row.
The overall construction industry index fell from 55·0 in December to 54.2 in January, according to figures provided by the Chartered Institute of Purchasing & Supply (CIPS). This is still above the crucial no change mark, however.

Commercial activity remained subdued, with the index at 51·3 in January against 52·0 in December.

The figures show that the housing market continued to drive expansion for the construction industry. While the housing market rose month on month in January, it was the lowest rise since September 2002. The housing activity index recorded 59·7 in January against 60·3 in December.

Roy Ayliffe, director of professional practice at CIPS, says: "January saw purchasing managers take advantage of the competition between suppliers, as they forced the rate of input price inflation down to the lowest for 11 months."

Although the increase in activity slowed, the industry remains confident. Construction firms remain optimistic for a rise in activity levels in the next year.

This confidence has been boosted by planned expansions, new marketing strategies and an anticipated strengthening of demand.

Source

Electrical and Mechanical Contractor