UK construction activity falls to three-year low
04/05/2016
Growth in the United Kingdom construction sector fell to the lowest rate in nearly three years in April, as uncertainty over the result of the EU referendum and the stagnation of new business hit productivity.
According to Markit, the trend is likely to continue into the coming months as uncertainty over the wider economy remains in place.
Housebuilding was the only slight positive in the construction sector, rebounding from its 38-month low in March, while at the other end of the scale, commercial building dropped to its slowest growth rate since July 2013, according to Markit.
Outside of construction, Markit also recognised that employment growth fell to one of the slowest rates in three years in April.
The overall fall in activity saw Markit’s own Purchasing Managers Index (PMI) fall to 52 in April. While this is still above 50, the level that signifies growth, it does represent a shortfall on analysts’ projected forecast of 54. It’s also a considerable drop from the 54.2 recorded in March.
Senior Economist at Markit, Tim Moore, commented that the “sluggish growth conditions” were likely to continue. He said: “Stalling new order volumes not only set the scene for further weakness ahead, but are already weighing on staff hiring and input buying across the construction sector," he said.
“Softer growth forecasts for the UK economy alongside uncertainty ahead of the EU referendum appear to have provided reasons for clients to delay major spending decisions until the fog has lifted."
Need Financial Advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245 or arranging a visit.
Share this..
Related stories
UK economy is no Greek tragedy
Even though the Office for Budget Responsibility significantly reduced forecasts for UK economic growth in 2010 and 2011 thankfully there was a reiteration that the UK economy is no Greek tragedy. In reality the Greek economy has been storing up problems for many years now, indeed many EU members have highlighted this in the past, and the credit crunch and resulting worldwide recession literally t...
Read MoreUK car production down 31.5% in August
Despite the fact that the UK car industry has been performing very well over the last three months, it was today confirmed that the production of new cars in the UK fell by 31.5% in August. This figure has shocked many in the industry although when you consider that August is historically one of the quieter months in the new car calendar, it is maybe not as bad as it looks at first glance. However...
Read MoreRecent rate rises shake Brits' security
People in the UK have told Lloyd's TSB's monthly survey team that they expect a further hike in the interest rate in 2007.According to Lloyd's Corporate Markets poll, 77 per cent of Brits expect another creep in the interest rate, while 13 per cent believe the rate will stay the same and an optimistic seven per cent expect the rate to fall.Because of expectations of a higher interest rate, more pe...
Read MoreWill the Bank of England reintroduce quantitative easing?
Last November the Bank of England placed on hold the quantitative easing program which had already swallowed up £200 billion of taxpayer's money. This is a system which was essentially to act as oil for the UK economic cogs and wheels and ensure that everything kept moving. It was a great benefit to UK businesses who were struggling to obtain liquidity in the depths of the downturn. So will the B...
Read MoreUK Employment Market Is Softening
The UK unemployment number has risen for the fourth month in a row, reflecting the changing prospects for the UK economy. While it can be very difficult to actually find the real rate of unemployment – due to the fact that the way of counting is amended on a regular basis – even the government’s own preferred method shows a rise of 38,000 to 1.643 million.
The n...