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CIPS: UK construction declines for 22nd month running

The UK construction industry shrunk for the 22nd month in a row in December the latest survey from the Chartered Institute of Purchasing and Supply has revealed.

The CIPS/Markit construction purchasing managers’ index recorded a score of 47.1 in December, indicating a further decline in construction activity with a score below 50 indicating contraction.

The score of 47 is the same as November’s figure and above the score of 46 in October.

However, despite the continuing recession and a further cut in employment, construction companies remained confident that a recovery will occur in 2010.

Both the commercial and civil engineering subsectors reported further declines in activity during December.

However, a rise in residential construction activity was reported, with the rate at which housing activity increased the fastest since August 2007.

CIPS chief executive David Noble said: “December was another disappointing month for the UK construction sector.

“Unlike other parts of the economy, it seems unable to escape the shackles of the recession, as it entered its twenty-second successive month of decline.”

He added: “Purchasing managers also remain confident that 2010 will be a much better year for the construction sector and that it will begin to grow again.

“However, whether this optimism is based on hope rather than foresight on orders in the pipeline remains to be seen.”

Markit economist Sarah Ledger said: “The rate of contraction slowed considerably during 2009, although with only one month of increasing new business indicated in that period, activity failed to grow.”