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Construction sector growth remains sluggish in November

The UK construction sector expanded again in November but the total number of jobs shrunk, according to the Markit/CIPS UK Construction Purchasing Managers’ Index.

New contract wins were restricted, according to the data, as clients deferred work. But optimism over future business prospects also improved to the strongest in five months.

The seasonally adjusted index posted 51.8 in November, where anything over 50 represents an expansion. The index rose slightly from October’s 51.6, yet the figure remains at a historical low.

CIPS chief executive, David Noble picked out housing as the most grimly sluggish sector.

“The house-building sector in particular continues to suffer as a weaker housing market makes builders nervous about committing to large new building projects and competition is rife. Purchasing managers say that growth in the current month was reliant on the commercial and civil engineering – yet uncertainty remains about the impact of public sector spending cuts.

“In the short term, the prospects for the UK construction sector look gloomy but confidence about possible recovery in the next 12 months has risen. Growth in order books continues to be sluggish as projects are delayed and this is impacting on purchasing activity. Perhaps most concerning is the fall in employment levels reflects job cuts rather than a freeze on new hires.”

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