Wednesday, 5 December 2012

UK Construction PMI - November 2012

Construction activity slipped back into contraction in November, for the third time in four months.

The Construction PMI fell to 49.3 last month, from 50.9 in October, adding to fears that the UK is on the brink of a triple-dip recession.

Economists had predicted a slight drop in this month’s figure to 50.5, still clear of the 50 mark - an indication of growth.

However, the latest reading was much lower than expected and the monthly survey found that confidence about the next 12 months fell to its lowest in almost four years.
In the last month, new orders declined at the steepest rate in over three-and-a-half years and jobs were cut at the fastest pace in almost two years.

Tim Moore (senior economist at Markit) said, “November’s PMI survey suggests that construction output has yet to hit rock bottom.”

Looking at the three broad sectors of the construction industry, residential building has fallen for six months running and the latest fall in commercial construction was the steepest since December 2009. However, the civil sector did increase this month and at the most marked pace for seven months.

In Q3 of 2012, there was an overall growth of 1% in the UK. However, with the PMI for manufacturing also demonstrating contraction, there are growing concerns that Britain is heading for its third recession in five years.

All eyes are keenly focused on George Osborne as he delivers his bi-annual budget statement today.