Latest data released by Markit/CIPS - 6 October 2020
- Prior 54.6
Construction activity is seen improving further towards the end of Q3 in the UK, with a sharp expansion in home building contributing to the jump here. Commercial projects also rose strongly, with work activity seen at its fastest pace in over two years.
This points to some added robustness in the construction sector for the time being, but there will certainly be questions about the recovery pace as we look towards the year-end.
CIPS notes that:
"UK Construction took off in September, soaring ahead of both the manufacturing and service sectors in terms of output growth and recording the fastest rise in purchasing activity since October 2015.
Fuelled by the easing of lockdown measures, new orders rose for the fourth month in a row and at the quickest pace since the beginning of the year before the pandemic struck. Of the three monitored subsectors, house building was the strongest performer, with activity increasing for the second month in a row, partially driven by residential-related services such as home improvements. However, civil engineering took another backwards step and progress worsened significantly as bigger construction developments stayed in suspended animation.
Government support schemes are winding down, so the bigger worry remains levels of job creation. With another drop in employment numbers, vacancies were sparse and further redundancy schemes could be on the cards once this pent-up demand for work is satisfied.
But for now, builders are stocking up for Brexit and Covid preparations, so purchasing remains strong in spite of longer delivery times and some shortages. Optimism is at a seven-month high, so builders are enjoying this resurgence in activity following the summer lows."
