“UK construction sector growth slowed in April as rising costs and economic uncertainty dented demand, according to a survey released on Friday.
The S&P Global/CIPS construction purchasing managers’ index fell to 58.2 from 59.1 in March, marking the worst rate of growth since January but coming in above expectations for a reading of 58.0. A reading above 50.0 indicates expansion, while a reading below signals contraction.”
“Tim Moore, economics director at S&P Global, said: “The construction sector is moving towards a more subdued recovery phase as sharply rising energy and raw material costs hit client budgets. House building saw the greatest loss of momentum in April, with the latest expansion in activity the weakest since September 2021. Commercial and civil engineering work were the most resilient segments, supported by COVID-19 recovery spending and major infrastructure projects respectively.”
“In addition, the government is planning for a 21.5% year-over-year increase in public sector gross investment this year, rebounding from weakness in 2021/22 caused by supply bottlenecks. Demand for new homes, however, looks set to fall in response to both the sharp fall in households’ real disposable income and a further increase in new mortgage rates.
“Meanwhile, shortages of raw materials and labour likely will be resolved only gradually over the course of this year. Accordingly, we expect construction output only to be about 1.5% higher in Q4 than in Q1.”
Reporting by Michele Maatouk at Sharecast.com.
