Construction doesn’t take time off over Christmas.
While the festive season is ordinarily seen as a time of rest, gluttony and unwanted presents, this hasn’t been the case for many in the industry this winter.
Figures released today from the Markit/CIPS Construction PMI, gathered between 4 and 22 December, suggest the industry saw increased levels of activity during the final month of 2015, bouncing back from a seven-month low recorded a month earlier.
There was no Hogmanay hangover in the commercial sector, where activity grew at its highest rate since October 2014, while housing also improved from the 29-month low seen in November.
Respondents to the survey chalked the improved output up to rising demand and more willingness among clients to commit to new projects.
Perhaps oddly, the only area to see a decline was civil engineering, where activity dropped for the first time in seven months.
But with extensive activity in flood defences and infrastructure, particularly in the latter part of December, it is likely that this sector’s figures will be revised up in next month’s report.
The data has been met with optimism by leading industry commentators. KPMG head of infrastructure Richard Threlfall and Scape Group CEO Mark Robinson were among those to hail construction’s happy new year.
Even civil engineering’s fall has done little to dampen spirits, with Mr Threlfall declaring his confidence that activity will pick up in the sector “given the huge pipeline of infrastructure work committed by the government”.
A note of caution, however. Cast your minds back to this time last year and you might remember a similar tone in the air.
It’s not to say the latest set of figures aren’t positive – they certainly are, and there’s a lot to be confident about for the industry this year. But at the beginning of 2015 the Construction Products Association was predicting that output would grow by 5.5 per cent by the end of the year.
By November, this was revised down to 3.6 per cent for 2015– a not insignificant shortfall.
In fairness, 2015 has had low points, not least the period immediately prior to and after the general election, but one month’s growth certainly does not mean that all of construction’s troubles can now be forgotten.
There is still plenty of work out there and firms are feeling bullish, but let’s not forget that there are still huge challenges to tackle – the skills gap isn’t going to go away – before construction can really start to celebrate the new year.
If some of you, like me, still baulk at paying £5 a pint in London, then you might not be surprised to learn that the capital is the most expensive place to build in Europe. Research from Arcadis suggests build costs in London are the second highest in the world, behind only New York.
Speaking of London, today has also seen some fighting words from mayoral candidate Zac Goldsmith, who claimed expansion at Heathrow is “off the agenda”. We may find out some time this year, next year, or within the next century, whether he is right.