Resi construction up; headline output figure drops: IHS Markit

IHS Markit’s latest PMI report shows that in January 2019, residential construction activity grew for the thirteenth month straight.

Despite this, a decline recorded in commercial and civil engineering activity brought down the overall activity for the first time in nearly a year.

According to IHS Markit, fragile housing market confidence has begun to act as a brake on residential work, evident by a loss of momentum that house building has endured since the end of 2018.

The report adds that input price inflation did go up on a monthly basis, but that it remains at the second-lowest level seen since June 2016.

IHS Markit economics associate director Tim Moore says: “The UK construction sector moved into decline during February as Brexit anxiety intensified and clients opted to delay decision-making on building projects.

“Risk aversion in the commercial sub-category has exerted a downward influence on workloads throughout the year so far.”

Naismiths managing director Blane Perrotton says: “The slowdown has become a slide. Suddenly the stagnation of January looks like an achievement rather than a blip.

“For much of the construction industry, 2019 has got off to a wretched start. The modest growth of residential building has been more than cancelled out by contractions in commercial and infrastructure work.”

Thistle Finance managing director Mark Dyason takes a more positive outlook: “It is encouraging to see that residential construction is at least in the black.

“Units are not flying off the shelves but Help to Buy and the lack of homes for sale are acting as a buffer against Brexit uncertainty,” he ads

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