Join us for FREE and access exclusive investments and property investment resources
Join IPIN here
Access exclusive opportunities that are only available to IPIN Members
Find out more
We never share your data with any third parties.
*Note: IPIN investment opportunities are available subject
to location and certain knowledge / experience criteria.
IHS Global Insight
Office for National Statistics
UK Construction Figures
UK construction has enjoyed a surprise return to growth in July, all the more surprising because of the fact that construction contracted at the fastest rate in over 2 years in June. In the Markit/CIPS construction PMI report the headline index rose to 50.9 in July, from 48.2 in June, anything above 50 indicates expansion. Economists had expected the sector to shrink for a second month, forecasting 48.7.
June's exceptionally poor performance was put down to unnaturally wet-weather for the season, combined with government cut-backs and weak private demand, all of which have been dragging down construction figures over the past few months. The Office for National Statistics estimated that construction output fell sharply in the second quarter overall, by 5.2pc, following a 4.9pc decline in the first quarter.
Economists are quick to caution that this rise does not mean we are out of the woods yet, far from it.
"While the construction purchasing managers' survey was not as bad as feared, it is still a weak survey that does little for hopes that the sector is poised for a significantly improved second half of 2012 after being a major drag on the economy during the first half," said Howard Archer, chief UK economist at IHS Global Insight.
"While the survey shows marginal expansion in activity in July, this seems like the bounce of a dead cat after output was held back in June by the two day's public holiday and particular wet weather."
The continued difficulties are evidenced by the fact that new orders fell in July, for the second straight month. Despite the fact that the fall was at a slower pace, the decline indicates no imminent bounce in activity. What is good is that construction employment grew in July; the PMI rose from 48.9 in June to 51.5 in July. Companies were also feeling more optimistic about business prospects than they were a month earlier.
Subscribe to IPIN Live by Email - Get our News & Blog updates delivered directly to your inbox - click here
*This page is provided for information purposes only and should not be construed as offering advice. IPIN is not licensed to give financial advice and all information provided by IPIN regarding real estate should never be treated as specific advice or regulations. This is standard practice with property investment companies as the purchase of property as an investment is not regulated by the UK or other Financial Services Authorities.