The latest PMI (Purchasing Managers’ Index) for the construction sector has revealed that the industry suffered its largest drop in activity since the 2016 Brexit vote in March due to severe weather disruption from the ‘Beast from the East’
The latest PMI for the sector came in at 47, down from 51.4 in February and below the 50 point that separates expansion from contraction.
City of London analysts had estimated a reading of 50.8.
Civil engineering saw its biggest drop in activity in five years. Commercial construction also fell sharply. Housebuilding, however, fared better in the month.
Tim Moore of IHS Markit, which compiles the survey, said: “Snow-related disruption was a key factor behind the marked decline in activity on site reported by survey respondents.”
In the immediate wake of the June 2016 Brexit vote, the construction PMI decreased from 51.2 to 46 as builders and investors put projects on immediate hold.
However, by September, the index had bounced back sharply as general confidence recovered.
A wave of cold weather from Russia, bringing heavy snowfall, hit the UK on 24 February 2018. Another freezing wave, dubbed the ‘Mini Beast from the East’ hit the UK on 17 March.
The latest PMI survey also indicated new orders contracting for a third successive month.
“Though March’s figures could be viewed as a temporary blip, without a strong pipeline of work, and strong risk strategies in place, the sector’s health remains in question as we’re still a long way off seeing it operate the way it has over the last year,” said Duncan Brock of the Chartered Institute of Procurement & Supply.