Flood defence projects make up for housing site slowdowns in February, says Markit/CIPS
The construction sector enjoyed a tenth straight month of increased activity in February, with flood defence projects making up for slowing growth on housing sites, according to the latest Markit/CIPS survey.
The monthly survey of purchasing managers, which measures how widespread rises or falls in activity across the industry are, recorded a value of 62.6 in February, down from a six-year high of 64.6 in January.
The index, prepared by CIPS and Markit, records growth as any figure above 50, with figures below 50 indicating a decline in activity.
Civil engineering overtook housing as the strongest area of growth in February as the wet weather led to an increase in flood defence work, while activity on housing sites was hampered by the weather.
The pace of expansion in civil engineering was the steepest since the Markit/CIPS series began in April 1997, while job creation hit a three month high in February.
Tim Moore, senior economist at Markit, said: “Construction output growth succumbed somewhat to the recent wet weather, with temporary disruptions from heavy rainfall most acute for house building activity in February.
“Consequently, residential work ceded its place as the best performing category to civil engineering, as construction work related to flood relief and infrastructure maintenance rose sharply over the month.
“While some froth has come off overall construction growth in February, the latest data showed that job creation picked up to a pace rarely seen since the summer of 2007.
“Moreover, in the latest survey there were six construction companies forecasting higher activity over the year ahead for every one anticipating a reduction.
“As a result, there appears an undiminished depth of belief among construction companies that strong growth will be sustained this year, helped by more favourable economic conditions and an ongoing house building recovery.”
David Noble, chief executive at the Chartered Institute of Purchasing & Supply, said: “Bad weather took a bite out of progress in house building, but UK construction remains on a strong growth trajectory in February.
“The sector was fuelled by the strongest rise in civil engineering activity in the survey’s history, as an increase in spending was recorded on investment and infrastructure projects in response to recent flooding.
“Even though both housing and commercial activity suffer ed a slide in pace of growth in February, the overall performance was one of continued expansion.
“Rising employment and highly positive business expectations also suggest that the slowdown will only be temporary. Backed by favourable market conditions, firms are continuing to increase staff numbers, hitting a three - month high this month.
“Strong demand is continuing to put pressure at a supplier level, with vendors battling with low stocks and prices increasing as a result. While delivery times are still deteriorating, they are at least doing so at the slowest rate since August 2013, suggesting that the very worst of the squeeze has passed.”