{"id":140312,"date":"2024-06-06T11:58:21","date_gmt":"2024-06-06T10:58:21","guid":{"rendered":"https:\/\/www.pbctoday.co.uk\/news\/?p=140312"},"modified":"2024-06-06T12:12:37","modified_gmt":"2024-06-06T11:12:37","slug":"may-construction-pmis-show-activity-rising-fastest-pace-two-years","status":"publish","type":"post","link":"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/may-construction-pmis-show-activity-rising-fastest-pace-two-years\/140312\/","title":{"rendered":"May construction PMIs show activity rising at fastest pace in two years"},"content":{"rendered":"

The May construction PMIs revealed that growth in the UK construction sector gained momentum last month, with rising workloads prompting renewed expansions in purchasing activity and employment<\/h2>\n

The headline S&P Global UK Construction Purchasing Managers\u2019 Index\u2122 (PMI\u00ae)<\/a> posted above the 50.0 no-change mark for the third month running in May, highlighting the sustained activity increase.<\/p>\n

The index rose to 54.7 from 53.0 in April<\/a>, pointing to the fastest increase in activity in two years.<\/p>\n

All three monitored categories saw activity increase for the first time since May 2022<\/h3>\n

The sharpest increase in activity was seen in the commercial category<\/a>, where the rate of growth accelerated to a two-year high.<\/p>\n

Meanwhile, housing activity returned to growth, and civil engineering activity rose at a solid but slightly lower pace.<\/p>\n

Expansion in activity on residential projects was found to be marginal.<\/p>\n

PMIs found that new orders linked to winning new contracts<\/h3>\n

The increase in total construction activity reflected sustained growth of new orders.<\/p>\n

New business rose at a solid pace for the fourth consecutive month as demand conditions improved.<\/p>\n

Firms found that high news orders resulted from winning new contracts and commencing previously delayed projects.<\/p>\n

Employment increased for the first time in five months<\/h3>\n

With new order growth sustained midway through the second quarter, job creation was the sharpest since last September.<\/p>\n

A renewed increase in purchasing activity was also registered in May, linked to improved workloads. The rise in input buying ended an eight-month decline.<\/p>\n

Where companies purchased inputs, they experienced an improvement in vendor performance amid reports that stock holdings at suppliers were healthy.<\/p>\n

The May construction PMIs also revealed that lead times shortened to the greatest extent in seven months.<\/p>\n

Improvement in availability of sub-contractors in May<\/h3>\n

Despite the largest expansion of sub-contractor usage since April 2022, the availability of sub-contractors significantly increased.<\/p>\n

The rates charged by sub-contractors also rose but at a pace weaker than the series average.<\/p>\n

Construction activity growth supported over the next 12 months<\/h3>\n

Looking ahead, increases in new orders are set to support continued growth of construction activity<\/a> over the next 12 months.<\/p>\n

Companies are also hoping for an improvement in economic conditions and a reduction in interest rates.<\/p>\n

The May construction PMIs found that business confidence increased to a three-month high last month.<\/p>\n

Workloads continue to increase<\/h3>\n

Andrew Harker, economics director at S&P Global Market Intelligence, said: \u201cThe UK construction sector looks to be building good momentum as we approach the middle of 2024, highlighted by activity increasing at the fastest pace in two years during May.<\/p>\n

\u201cParticularly pleasing was the broad-based nature of the rise in activity as work on housing projects increased for the first time in more than a year-and-a-half.<\/p>\n

\u201cFirms are gearing up for further growth in the months ahead, posting renewed expansions in both employment and purchasing activity as workloads increase.\u201d<\/p>\n

The market is still facing some challenges<\/h3>\n

Jordan Smith, technical director at Thomas & Adamson, said: \u201cThe Construction PMI figures are encouraging, but there is a lot going on beneath the surface. We\u2019re certainly beginning to see more stability and signs of future growth.<\/p>\n

\u201cHowever, the market is still challenging, with a number of projects either being paused, pushed out, or held at early design stages because of issues relating to cost, viability, and the level of returns on investment.<\/p>\n

\u201cCost increases are stabilising, but they are still on the rise, driven by material shortages, a tight labour market, and limited supply chain capacity. Careful consideration towards cost management and the overall approach to projects remains key to mitigate risk.\u201d<\/p>\n

\u00a0Campaign promises may further drive UK construction growth<\/h3>\n

Sean Keyes, CEO of Sutcliffe, said: \u201cI am pleased to welcome today\u2019s news that Britain\u2019s construction sector has recorded its largest rise in activity in two years last month, highlighted by the first increase in house-building since shortly after September 2022.<\/p>\n

“To see PMI rise to 54.7 from 53.0 is a very encouraging sign, indicating growing momentum in the sector. This upward trend is promising as we are readying ourselves for further growth, though we have seen more of a steadying in the industry as we have continued to work on over 20,000 homes per year.<\/p>\n

“With both political parties pledging further investment in the construction industry, with a particular focus on the need for more housing, I\u2019m hoping to see this upward trajectory continue in the run up to the general election.\u201d<\/p>\n

\n<\/div>","protected":false},"excerpt":{"rendered":"

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