IHS Markit’s May construction PMI reached 64.2%, beating economists’ expectations
The construction sector grew at its fastest pace in nearly seven years last month as new orders surged as lockdown restrictions eased.
IHS Markit’s Construction Purchasing Managers’ Business Index rose 0.6% to 64.2% in May, the highest level since September 2014.
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It also exceeded economists’ expectations of 62.3. A record above 50 is a sign of growth.
Growth was particularly strong in the residential construction sector, as home prices soared more than 10% on an annual basis in May.
Residential construction was followed by commercial jobs, which recorded the highest growth since August 2007.
Tim Moore, economics director at IHS Markit, said: “British construction companies are set for another month of rapid output growth on the back of a surge in residential work and the fastest rise in commercial building since August 2007. reported.”
Cost pressures on construction companies also increased at the fastest pace since records began, as supplier deadlines soared.
“Despite severe challenges to material availability, construction companies remain very optimistic about their near-term growth prospects,” Moore said.
Additional data shows the UK is on track for a strong growth recovery. Other research into the manufacturing and services sectors suggests that the UK economy is currently participating in broad-based growth.
The all-sector PMI, which combines PMI surveys for construction, manufacturing, and services, rose 2.2% in May, hitting a record high.
Employment growth in the construction industry remains at its highest level since 2014, as demand for workers reached a record high in May.
Meanwhile, EY ITEM Club chief economic adviser Howard Archer warned of what the data meant. “Input prices have risen at the fastest pace in the history of the study, driven by expanded supply chains and rising raw material prices” in just over 24 years. ”
“This is sure to further heighten inflation concerns.”
