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Commercial property construction down across UK in May

Commercial property construction down across UK in May

Construction within the commercial property sector fell in May, according to a new survey by the Chartered Institute of Purchasing and Supply (CIPS) and financial information company Markit.

Even though the rate of contraction was easing, this sector and civil engineering still fell short last month, whilst housebuilding saw a nice rise. Overall, the construction sector along all industries marginally grew in May after six months of falling, but this prevented sector employment to rise.

The CIPS purchasing index had risen from 49.4 to 50.8 from April to May, which is great news for the industry considering that the level of 50 marks the balance between sector expansion and contraction.

This is the first time the Index has gone beyond the 50 level since October 2012, but it is important to note that the reading is still a long way away from the long-term survey average of 53.9, whilst the commercial construction sector remainED under 50 for the third month in a row.

David Noble, chief executive officer at CIPS, said: "The construction sector seems to have turned a corner after six dismal months. The improvement has been fuelled by a boom in housebuilding, but the sector remains bogged down by contractions in commercial construction and civil engineering.

"The government's attempts to boost housebuilding have given months of lacklustre growth a shot in the arm, but the continued decline in civil engineering can be largely attributed to the lack of public sector projects, which show no sign of increasing.

Good news emerged that the number of construction orders had risen by a small amount; the first time this had occurred for over a year.

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