Apparently, the UK construction sector is slowly rising like a phoenix from the ashes as the newest findings showed that the segment finally recorded modest growth in May. Without a doubt, good news was brought as house building activity significantly strengthened.
Ray of light in construction sector
The Chartered Institute of Purchasing and Supply and Markit issued their survey, showing that the UK construction sector advanced first time in seven months. The detailed findings indicated the UK construction PMI climbed to 50.8 in May, compared to the April’s final reading of 49.4. Thus analysts underline that it seems that the sector has finally witnessed good days after gloomy and depressing months.
According to data, house building improved significantly as the sub-indexed climbed to 54.4 in May, compared to 51.2 recorded in April. Furthermore, the UK saw the house building sector advancing in the month at the fastest rate in more than two years.
As for new orders in the UK construction sector, they witnessed modest improvement in May. However, the released report indicated that the civil engineering and commercial property construction experienced a continual slump in the month of May. It is worth underlining that the rates of contraction slightly abated though.
The findings of the survey, which was released by the Chartered Institute of Purchasing and Supply and Markit, might indicate that the confidence in the sector would strengthen in the near future. Analysts note that construction companies will be carefully watching the UK economy as well as housing market, waiting for clear evidence of the visible advancement.
The UK government focuses on driving improvement in the sector by introducing different sweeteners, including the initiative known as Help to Buy aimed at backing people who want to purchase their first home.
Interpreting the findings, David Noble, chief executive officer at CIPS, noted: "The Government's attempts to boost house building have given months of lackluster 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.”
Unquestionably, the construction sector is important for the UK economy but it has been disappointing for several months. As for the first quarter of 2013, the country saw construction activity dive around 2.5 percent, while the economy advanced modestly by 0.3 percent.
The latest results for the May have arguably improved moods of many, showing that the country is slowly standing on its feet. Therefore it is not surprising at all that construction companies are sanguine about the future as everything indicates that the UK economy is gradually getting out of the woods.