Latest data released by Markit/CIPS - 6 July 2020
- Prior 28.9
That is a decent rebound in construction activity as the economic reopening gathers pace, with new orders even seen stabilising after three months of sharp decline.
Of note, commercial and civil engineering work also returned to growth last month, following that of residential activity so that is a positive takeaway.
That said, a sustained return to pre-virus conditions will be the real challenge moving forward and we'll see if that can be achieved in the coming months.
Markit notes that:
"June's survey data revealed a steep rebound in UK construction output as more sites began to reopen and the supply chain kicked into gear. House building led the way with the fastest rise in activity for nearly five years, while commercial and civil engineering also joined in the recovery from the low point seen in April.
"As the first major part of the UK economy to begin a phased return to work, the strong rebound in construction activity provides hope to other sectors that have suffered through the lockdown period. While it has taken time for the construction supply chain to adapt and rebuild capacity after widespread business closures, there is now clear evidence that a return to growth has been achieved.
"While some survey respondents commented on cautious optimism about their near-term prospects, construction companies continued to face challenges securing new work against an unfavourable economic backdrop and a lost period for tender opportunities. At the same time, operating expenses are rising due to constrained capacity across the supply chain and the impact of social distancing measures.
"Looking ahead, construction firms are more confident than at any time since the start of the COVID-19 pandemic. However, the ongoing reductions in staffing numbers seen in June provide a stark reminder that underlying conditions across the sector are a long way off returning to those seen before the public health emergency."
