Member Article

Construction sector witnesses dramatic fall in activity

The UK construction sector has witnessed the most dramatic fall in activity for two and a half years last month, according to the Markit/CIPS purchasing manager’s index (PMI).

Activity in the sector fell to 48.2 in June, from 54.4 in May. Any figure below 50 suggests contraction in the sector.

Employment also fell for the first time in four months.

ONS figures indicated that construction industry output fell by 4.8% in the first quarter of 2012, while the economy as a whole contracted by 0.3% over the period.

Inactivity over the Jubilee bank holiday weekend was a contributing factor to the decline, although many respondents also commented on weaker underlying business conditions.

The weakest areas of construction were civil engineering and housing activity.

Commenting on the figures, Tim Moore, a senior economist at Markit said: “A drop in business activity was perhaps inevitable given that the month started with an additional bank holiday and ended with severe weather across large parts of the UK.

“However, these temporary factors should not be overplayed, as the latest figures reveal worsening underlying business conditions within the sector.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .