Irish construction sector continuing to expand

Following Brexit, Ireland’s construction sector has continued to expand, with construction industry activity rising sharply in July.

In Ireland, construction growth reached a four month high for July, with an increase in orders and employment, according to the Ulster Bank Construction Purchasing Managers’ Index (PMI).

In the wake of the UK’s decision to leave the EU, economists at the bank highlighted that Irish building firms are more domestically focused, and therefore less likely to be impacted than exporters.

The PMI is designed to track overall activity, and changes in the construction sector in the Republic of Ireland.

The key index designed to track overall activity rose to 61.0, from 59.7 in June, signalling strong growth. Total activity has now risen in each of the last 35 months, showing strong confidence, with 58% expecting expansion to continue over the next year.

The survey suggests employment continues to grow in the construction sector, as the increase in orders has led to a need for more staff and an increase in purchasing levels.

Simon Barry, a senior economist at Ulster Bank, said: “The July survey results offer the first glimpse into Irish construction trends following the UK referendum.

“The continuation of strong trends in overall activity and new business provide important encouragement that the sector’s recovery is maintaining solid momentum at present.

“Underpinning the further uplift in activity last month was a further significant increase in new business, with the new-orders index also rising to its highest level since March.”

Commercial construction was the strongest performing sector, with housing activity also rising at a sharp pace.

Civil engineering activity continues to expand, although some are much slower than the other two main sectors.

 

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