Builders upbeat on prospects for next year despite partial shutdown
Ulster Bank purchasing managers index shows improvement in March over February
Dublin’s docklands: Almost 60 per cent of builders expect to expand over the next 12 months.
Builders are becoming “increasingly upbeat about the prospects for recovery” despite the strain of lockdown, according to an index that tracks sentiment in the sector. Almost 60 per cent of builders now expect to expand over the next 12 months.
Ulster Bank’s purchasing managers index, which tracks material orders as a bellwether of what lies ahead for the sector, remains depressed with a monthly score for March of about 30 – anything below 50 shows a decline in the sector.
However, this was still an improvement on February’s score. The construction sector, which has been almost 50 per cent shut since the new year, had been hoping for a full reopening in April’s easing of restrictions. However, only housebuilding was allowed to return and the remaining quarter of the sector, consisting of non-essential commercial building activity, will resume in May at the earliest.
“While the pace of decline in overall activity eased somewhat relative to the very extreme weakness registered in January and February, the March results again highlight that activity was markedly restrained by the pandemic-related restrictions throughout the first quarter,” said Simon Barry, the bank’s chief economist in the Republic.
“Despite what has undoubtedly been an exceptionally weak start to the year, survey respondents are becoming increasingly upbeat about the prospects for recovery. The future activity index jumped again in March to stand at its highest level in 2½ years. The jump in confidence was underpinned by the expectation of improved business conditions for the sector as restrictions are eased and pent-up demand is released.
Residential and childcare contruction projects will resume today as the State eases a number of coronavirus restrictions.