- Reuters / Darren Staples
LONDON – Growth in Britain’s construction sector continued to accelerate in May, enjoying “a sharp rebound in business activity,” according to the data from IHS Markit out on Friday.
IHS Markit and CIPS’ latest PMI release for the construction sector – which measures expectations of growth – came in at 56 for the month of May.
That was up from the 53.1 reading in April, and even further above the 52.7 forecast by economists prior to the release.
The purchasing managers index (PMI) figures from IHS Markit are given as a number between 0 and 100.
Anything above 50 signals growth, while anything below means a contraction in activity – so the higher the number is, the better things look for the UK.
“UK construction companies experienced a sharp rebound in business activity during May, helped by the fastest upturn in residential work since the end of 2015,” a statement said.
“The latest survey also revealed a sustained recovery in new work, following the soft patch seen during the first quarter of 2017. Increased workloads encouraged greater staff recruitment and a marked expansion of input buying across the construction sector.”
Here is the chart:
- IHS Markit
Commenting on the findings, Duncan Brock, Director of Customer Relationships at CIPS said (emphasis ours):
“After years of sluggish house building, the construction sector has snapped back into action in May. Construction growth has surged to a 17 month high as the uncertainty caused by the EU referendum appears to be abating.
“The unexpected recovery in construction has been felt most acutely in residential housing as builders finally feel able to respond to demand for new homes. The sector had been held back by the rising cost of raw materials but after months of tense negotiations with suppliers, input prices are starting to stabilise.”
Friday’s numbers come 24 hours after IHS Markit’s PMI data showed that the UK’s manufacturing sector is still growing rapidly in the aftermath of the referendum. The manufacturing PMI hit a level of 57.6 in May, remaining “resilient” and “sustaining most of the growth momentum gained” in a strong April for the sector.