Construction activity falls further
Activity in the construction sector slowed further in November as the number of new orders declined, according to an Ulster Bank survey.
The bank’s construction purchasing managers index (PMI) was unchanged at a reading of 42.6 last month, with readings under 50 showing contraction in the sector and over 50 pointing to growth.
The levels of decline in housing and civil engineering activity slowed last month, to readings of 44.2 and 31.1 respectively, but both were well below the point of growth. Commercial activity declined sharply from 44.1 to 39.8.
The survey found that job losses intensified in the sector last month, in line with reduced workloads, to the sharpest rate since May of last year and that firms had also lowered their input buying.
“Reduced staff and stock holdings at suppliers contributed to a lengthening of delivery times during November. The solid deterioration was the seventeenth in as many months,” the survey states.
The rate of input price inflation increased on the back of higher fuel costs, the index found, and confidence in the sector fell further.
The new orders index contracted for the eleventh consecutive month.
“The provision in Budget 2013 for the establishment of Real Estate Investment Trusts (REITs) may provide some support for the property sector over time,” Ulster Bank economist John Fahey said.
”Overall though, the near term prospects for the construction industry remain weak and the sector will continue to face a challenging outlook in the coming months.”