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Summary
- The UK construction sector recorded growth in March 2021.
- The Markit UK Construction Index for March came in at 61.7.
- The House building index contributed the highest in construction activity.
The UK construction sector has recorded growth in March 2021 largely steered by the hopes of reopening the commercial setups including the indoor as well as outdoor settings with several standard operating procedures. A robust growth has been realised in all major categories of the UK construction activity during the past month led by the increase in commercial work, house building and civil engineering, a survey revealed.
The reading for IHS Markit/CIPS UK Construction Total Activity Index came in at 61.7 in March as compared to the February’s record of 53.3. Following the adjustments for seasonal influences, the March construction output has registered the sharpest growth since September 2014.
The house building index, with a reading of 64.0, contributed the highest towards the growth in the construction activity in the corresponding month. This has been the fastest growth since July 2020. The commercial construction and civil engineering work also accorded the rise in the construction activity with the respective readings of 62.7 and 58.0. These are the highest readings for both commercial construction and civil engineering since H2 2014.
UK Construction PMI March 2021: Key highlights
- Led by the rising new home sales and greater spending on residential construction work, the infrastructure projects got a boost in March followed by the improved demand from the clients.
- The commercial contract awards that had to cease their operations due to pandemic-induced restrictions improved in March, effectively contributing to the steep upturn in the new orders.
- Meanwhile, the accelerated start in the new projects in the near future has led to a solid rise in the employment figures with the rate of job creation spiralling to a 27-month high.
- In response to the greater workloads, construction companies have indicated a sharp increase in the purchasing volumes.
- Following the development, a higher demand for the construction materials and products have ultimately increased the waiting time for the deliveries by the suppliers.
- Given the operational environment in March, about 41 per cent of the survey panelists reported longer delivery times from the suppliers.
- As far as the imported items are concerned, the supply constraints and logistics remained the issue for the construction companies partially due to the disrupted cross-border trade on the back of Covid curbs.
- Notably, the post-Brexit framework and challenges associated with it and the extended course of Covid-19 pandemic have been the major reasons for the price hikes in March.
