Construction growth accelerates for third consecutive month

Civil engineering expands for first time since last September, Ulster Bank survey finds

Momentum picked up in the Irish construction sector in April with output, new orders and employment all expanding at sharper rates compared to March, the Ulster Bank construction purchasing managers' index (PMI) shows.

Sentiment regarding the 12-month outlook for output also improved.

Growth accelerated for the third consecutive month in April, posting a reading of 61.3, up from 60.8 in March and moving further ahead of the 50 mark that separates growth from contraction. The PMI is now at a six-month high.

"The positive messages from the headline index were reinforced by a further strong increase in new business, with the new orders index also rising to its highest level since October," said Simon Barry, chief economist for Ulster Bank in the Republic of Ireland.


“Strong demand for the services of construction firms was also very much evident in further substantial increases in employment and input buying last month.”

All three subsectors – civil engineering, commercial activity and residential construction – posted increases in activity, with civil engineering recording what Ulster Bank said was a “welcome return” to growth in April. This was its first expansion since September last year.

Commercial activity also expanded at a very rapid rate, albeit that the pace of growth slightly eased in April, while housing remains “an area of particular strength” with the rate of growth once again ticking up in April.

Survey respondents reported that strong momentum in the housing sector, along with improving economic conditions more generally, were likely to lead to sustained momentum in construction activity over the coming 12 months.

The rate of job creation in the Irish construction sector also picked up at the start of the second quarter.