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House building boosts UK construction industry


The UK construction industry grew at its fastest pace in four months this June as a result of an increase in house building, according to the Markit/CIPS Purchasing Managers Index (PMI).

The PMI is a measure that determines how quickly the construction industry is growing or shrinking. A measure above 50 indicates growth and vice versa for a measure below 50.

Despite predictions from analysts’ that the PMI for the construction industry would fall from 60.0 to 59.5, it actually increased to 62.6 in June – the fastest growth in four months. Additionally, the figures showed that construction firms have been recruiting new staff at the fastest rate since the survey was first started in 1997.

House building was the biggest driver in growth for the industry as a whole, largely due to low interest rates, rapidly increasing house prices and strong demand in the market.


The same survey also found that the commercial property sector has started to grow, after being particularly hard hit by the financial crisis.

The data showed that the commercial property sector grew by 1.5% over the first three months of 2014, and by a further 1% in the three months to June. This meant that over the last 12 months, the commercial property sector grew by 6.7%, which is its biggest annual increase for three years.

Tim Moore, senior economist at Markit said that the figures “represent a remarkable yardstick of progress as the sector looks to recover the ground lost over the past seven years".

Furthermore, David Tinsley, UK economist at BNP Paribas also spoke positively of the current situation for the construction industry, claiming that the figures indicate a “very solid month” for the economy in June.

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