Construction dents UK recovery hopes
PUBLISHED: 16:39 05 May 2015 | UPDATED: 16:39 05 May 2015
Britain's construction industry grew at its weakest pace for nearly two years in April, further denting hopes of a pick-up in the pace of the wider recovery after a slow start to the year.
The sector posted a reading of 54.2 on the closely-watched CIPS/Markit purchasing managers’ index (PMI) survey - where 50 separates growth from contraction. It was the lowest level since June 2013, and down from 57.8 in March.
Much of the slowdown appears to have been caused by pre-election jitters, with firms reporting that uncertainty ahead of tomorrow’s poll had contributed to delays in clients’ spending decisions.
But it follows official gross domestic product (GDP) data that last week showed the overall pace of growth slowing to 0.3%, its weakest pace in more than two years, and a survey of manufacturing for April which has also shown a sharp weakening.
Today’s construction figures showed that despite the growth slowdown, job creation remained “robust” with confidence above average, though lower than in March.
Markit chief economist Chris Williamson said: “Together with a steep slowdown in manufacturing and disappointing GDP data, the construction survey adds to evidence that the UK economy has hit a soft patch.
“However, the construction slowdown may prove temporary, having been at least in part due to uncertainty and construction project delays in the run-up to the most closely fought General Election in a generation.
“Encouragingly, companies are expecting business activity to turn higher in coming months, with optimism about the year ahead remaining elevated in April having climbed to a post-recession high in March.”