Reaction to Markit/CIPS UK Construction PMI for October

The Vinden Partnership says the latest results may indicate the economy is picking up after disappointing third quarter.

The Markit/CIPS UK Construction Purchasing Manager’s Index for October has been published and reveals that the construction industry continues to experience strong growth, despite a slight fall on September’s results.

UK construction’s PMI dropped to 58.8 in October, down from 59.9 in September, but still well above the growth threshold of 50 and marks two-and-a-half years of sustained output growth across the UK construction sector.

The housing sector dropped from September’s high, while civil engineering slowed, continuing its recent trend.

Employment also reached its highest level since November 2014.

Once again, construction companies were upbeat about the prospects for growth over the coming 12 months with 59% expecting an increase in business, with only 7% forecasting a drop.

Rob Davis, Managing Consultant at The Vinden Partnership – a leading multi-disciplinary consultant company to the built environment – said the figures might show that the economy is beginning to pick up again after a “sluggish” performance over the last quarter.

Mr Davis said: “Following on from the latest strong manufacturing PMI, the construction industry’s PMI figures for October may be an indication that the economy is beginning to perform more strongly after a slightly sluggish last quarter.

“It is clear that a vibrant construction industry has a huge part to play in the success of the UK economy.”

The post Reaction to Markit/CIPS UK Construction PMI for October appeared first on UK Construction Online.

Highways England appoint contractor on £3M scheme

Improvements will take place in Essex and Suffolk as £3M contract provides safer journeys for drivers.

The package of work which is set to make big improvements on the A12 and A14 has moved a step closer with the appointment of a contractor for the scheme. The work that will be carried out will go through Marylands interchange, Copdock and Seven Hills interchange.

The contract has been brought about by Highways England as a show of commitment to the area with the focus on improving safety by making changes which will allow better quality roads with less congestion. The work will include the resurfacing, replacing and installing of new roads, barrier replacement, drainage and embankment work.

Aran Nugent, Service Delivery Team Leader at Highways England, said: “The appointment of the contractor is a vital part of the delivery of improvements to some of our major roads in Essex and Suffolk. This scheme will make journeys better for local people by improving safety for the thousands of drivers that use these roads each day.

“We expect the work to start in the winter and be completed in the spring next year. We will work with the contractor on how the works will affect people, but I’d like to assure drivers, where possible, disruption will be kept to a minimum and to bear with us while the works take place as there will be a small amount of pain for a large amount of gain.”

More details will be announced shortly.

The post Highways England appoint contractor on £3M scheme appeared first on UK Construction Online.

Markit/CIPS UK Construction PMI released for October

A rise in commercial building helps keep the construction industry growing.

The construction industry continued to experience strong growth in October according to the latest Markit and the Chartered Institute of Purchasing & Supply (CIPS) UK Construction Purchasing Managers’ Index (PMI) figures.

UK construction’s PMI dropped to 58.8 in October, down from 59.9 in September, but still well above the growth threshold of 50 and marks two-and-a-half years of sustained output growth across the UK construction sector.

Housing activity was down from September’s high and the civil engineering sector also saw its slowest rate of growth since May.

Companies remain very optimistic about the potential for growth over the next 12 months, with 59% predicting a rise in business activity and only 7% anticipating a decrease.

Employment levels saw its fastest increase since November 2014, with respondents indicating a move away from reliance on sub contractors.

Tim Moore, Senior Economist at Markit said that the survey’s findings show that the UK Construction industry “remains firmly in expansion mode” despite commercial building being the only category to show faster growth than in September.

Mr Moore commented: ““Another relatively buoyant construction PMI reading indicates that the sector remains in rude health. Rather than acting as a drag on the economy, as suggested by recent GDP estimates, the sector is continuing to act as an important driving force behind the ongoing UK economic upturn.

“Construction companies also noted a rebound in new business flows during October and responded to rising workloads by taking on extra staff at the fastest rate for almost a year. Shortages of skilled staff persisted as a result, with the current period of falling sub-contractor availability the longest seen in over a decade.”

The post Markit/CIPS UK Construction PMI released for October appeared first on UK Construction Online.

World’s largest floating wind farm given go ahead

The Scottish government has granted a marine licence that will see the creation of the world’s largest wind farm development off the coast of Peterhead.

Norwegian energy company, Statoil, plan to develop a pilot park of five floating 6MW turbines to be located around 25Km miles off the coast of Peterhead and will be capable of generating 135GWh of electricity per year.

It is hoped that that the Hywind Scotland development could provide power for up to 19,900 homes.

Unlike conventional turbines, Hywind turbines will be attached to the seabed by a three-point mooring spread and anchoring system.  An inter-array of cables will connect the turbines and an export cable will carry electricity from the pilot park to shore at Peterhead.

Deputy First Minister John Swinney said: “Hywind is a hugely exciting project – in terms of electricity generation and technology innovation – and it’s a real testament to our energy sector expertise and skilled workforce that Statoil chose Scotland for the world’s largest floating wind farm.

“The momentum is building around the potential for floating offshore wind technology to unlock deeper water sites. The ability to leverage existing infrastructure and supply chain capabilities from the offshore oil and gas industry create the ideal conditions to position Scotland as a world leader in floating wind technology.”

Statoil’s Executive Vice President for New Energy Solutions Irene Rummelhoff commented: “Floating wind represents a new, significant and increasingly competitive renewable energy source. Statoil’s objective with developing this pilot park is to demonstrate a commercial, utility-scale floating wind solution, to further increase the global market potential.

We are proud to develop this unique project in Scotland, in a region that has optimal wind conditions, a strong supply chain within oil and gas and supportive public policies.”

The Carbon Trust believe that floating wind concepts could potentially reduce generating costs to below £100/MWh in commercial deployments, with the leading concepts such as Hywind, with even lower costs of £85-£95MWh.

Statoil plan to commence onshore construction in 2015/16, and offshore construction in 2016/17. Final commissioning of the pilot park will be approximately 2017.

The post World’s largest floating wind farm given go ahead appeared first on UK Construction Online.

Fuel Prices to be displayed on the M5

A section on the M5 between Bristol and Exeter will trial electronic message signs that will display the cost of fuel along the motorway.

The scheme is being trialled by Highways England and is designed to provide drivers with more information to help plan their journey and to provide a more competitive fuel market, leading to cheaper service station fuel prices.

Five motorway service areas are taking part in the trial, which if successful, could see the programme rolled out nationally.

The electronic signs will show the fuel prices at Gordano, Sedgemoor, Bridgwater, Taunton Deane and Exeter motorway service areas.

Roads Minister Andrew Jones said: “The government is on the side of the honest motorist who have raised concerns for too long about petrol prices at motorway service stations.

“This trial will allow drivers to be much better informed about the cost of fuel and make it easier to plan their breaks around the cheapest deals.”

The trial will run until the end of 2017 and will be monitored Highways England will observe the effectiveness of the signs in terms of its use to road users and the influence it has on fuel prices.

A potential unwelcome consequence of the signs could be the safety implications of more motorists running out of fuel as they attempt to hold out for a cheaper option. This is something that will also be monitored by Highways England.

Chief Highways Engineer at Highways England, Mike Wilson said: “Providing fuel price information is an important part of a bigger picture – we want road users to be more informed and in better control of their journeys. This means they’ll be better prepared, more inclined to plan breaks and have a positive driving experience.

“It’s still very important for motorists to properly plan their journeys and ensure they have sufficient fuel. Running out of fuel on motorways can be hazardous to yourself and other drivers.”

The post Fuel Prices to be displayed on the M5 appeared first on UK Construction Online.

Markit/CIPS UK Manufacturing PMI released for October

The UK manufacturing purchasing managers’ index (PMI) increased to 55.5, a healthy increase from September’s revised figure of 51.8. The 3.7 increase is the sharpest seen in the almost 24 year history of the survey.

October also saw employment in the manufacturing sector rise for the thirtieth consecutive month, buoyed by new orders and efforts to clear backlogs of work.

Rob Dobson, Senior Economist at Markit commented: “The revival provides a tentative suggestion that the manufacturers are pulling out of their recent funk, having been dogged by recession since the start of the year, and may help boost economic growth in the fourth quarter.

“The big question now is whether this bounceback is a one-off or the start of a sustained re-emergence from recession.

“The ongoing strength of the domestic market and a welcome improvement in new export orders led to a broad-based upturn in production of consumer, intermediate and investment goods. The revival of overseas sales is a particularly encouraging aspect of the latest survey, helping to dispel fears that global demand is slumping and boding well for the outlook.”

Mr Dobson also pointed that most of the growth was attributable to the larger manufacturers. SMEs needed to “join in the recovery to help prevent the upswing from faltering.”

David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply said overseas orders contributed significantly to the growth. He commented: “The sector rode on the crest of an exports market wave taking full advantage of the opportunity to create a surge of output growth and new orders.

“Though domestically orders were still strong, it was export orders primarily from the Middle East, East Asia and the USA, that supported this expansion of work.”

The post Markit/CIPS UK Manufacturing PMI released for October appeared first on UK Construction Online.

Engineering construction workers agree pay deal

Engineering construction workers have agreed to a 6% pay increase over the next three years, with 66.8% of members from both Unite and GMB unions voting to accept the deal, which will start from 4 January 2016.

The national agreement covers 8600 engineering construction workers and will be in force on all major engineering construction projects across the UK, including oil and gas, petro-chemical and energy schemes.

The members are employed under the National Agreement for the Engineering Construction Industry (NAECI).

The agreement also sees an increase to all hourly rates of pay and also provides travel and accommodation allowances on a yearly basis.

A new supplementary payment clause for future Nuclear New Build projects will be created, which will provide an increase earnings.

Unite National Officer and Secretary of the National Engineering Construction Committee, Bernard McAulay said:“The talks have been challenging in an extremely difficult economic climate. This three year settlement shows the commitment of the signatory parties to continue to uphold the founding principles and values of direct employment under the terms and conditions of the national agreement.

“This agreement is essential in delivering the next generation of low carbon energy projects across the UK, which are crucial in facilitating the transition of the country’s existing energy source to a low carbon economy by 2030, whilst providing employment opportunities for the next generation of highly skilled engineering construction workers.”

The post Engineering construction workers agree pay deal appeared first on UK Construction Online.