IHS Markit/CIPS UK Construction Activity Index for February was 53.3
After a sluggish start to the year, British construction companies returned to strong growth in February, according to research compiled by IHS Markit.
PMI data also revealed that new orders are regaining momentum amid economic optimism and more projects are starting.
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The seasonally adjusted IHS Markit/CIPS UK Construction Activity Index for February was 53.3, up from 49.2 the previous month. Indicators above 50 indicate that overall construction output is increasing.
Despite the lockdown, the index remained above 50.0 in eight of the past nine months.
Housing-related jobs continued to show the strongest growth, but the pace of recovery has slowed slightly since January.
FTSE 100 companies such as Persimmon and Taylor Wimpey have supported London’s blue-chip index in recent months, even as other sectors have struggled due to the pandemic.
The industry was given a boost yesterday when the Chancellor promised to “stand behind homebuyers” in his budget speech in the House of Commons.
Commenting on the findings, Tim Moore, economics director at IHS Markit, said:
“Construction work regained its position as the fastest growing major sector of UK private sector production in February. Successful vaccine rollout has helped boost contract wins for projects delayed in the early stages of the pandemic. The recovery was supported by the largest increase in commercial development activity since September of last year,” Moore said.
“Residential construction remains the driving force behind the construction sector’s recovery, but momentum has been lost since January as adverse weather conditions and longer wait times for materials led to temporary delays on site.”
“The main areas of concern for construction companies in February were supply chain expansion and sharp increases in transportation costs. Reports of delivery delays were more widespread than at any time in the 20 years prior to the pandemic. This reflects a combination of strong global demand for raw materials and shortages in international transportation.The imbalance in supply and demand has since caused purchasing costs across the construction sector to rise at the fastest rate since August 2008. It rose to
