Markit/CIPS UK Construction PMI released for November

Housebuilding grew at slowest rate for over two years in November.

The results come on the back of the Chancellor George Osborne’s Autumn Statement outlining Britain’s biggest house building plan since the 1970s to deal with “the crisis of ownership”.

The UK construction PMI fell to 55.3 from October’s 58.8, the slowest period of expansion for seven months but still well above the growth threshold figure of 50.0. Markit said that this was the weakest month in two and a half years, if April is excluded on the grounds of the pre-election slowdown.

Residential building saw its slowest performance since June 2013, while civil engineering experienced its weakest growth rate in six months.

Commercial expansion saw the biggest growth but well down on its October figures.

Employment also grew at its slowest rate since September 2013.

Howard Archer, Chief UK and European Economist at IHS Global Insight, said: “The marked slowdown in housebuilding in November will be particularly disappointing for the Government which is currently prioritising the sector to deal with the UK’s serious housing shortage.

“It highlights the need for supportive action to boost the sector.”

Tim Moore, Senior Economist at Markit commented: “The UK construction recovery is down but not out, according to November’s survey data. Aside from a pre-election growth slowdown in April, the latest expansion of construction activity was the weakest for almost two-and-a-half years amid a sharp loss of housebuilding momentum.”

“Overall the latest results suggest that construction companies have become a little more cautious towards year-end, especially in terms of job hiring. However, a healthy flow of new tenders from public and private sector clients is expected to provide a tailwind to growth heading into 2016.

“Reflecting this, UK construction firms were again overwhelmingly positive about the outlook for their business activity, while only a small proportion anticipates falling output levels during the next 12 months.”

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