Pace of jobs and activity growth in construction accelerates
Employment in building industry up 40% in first quarter of year, according to IrishJobs.ie
New orders drove the sharpest increase in building for five months in March, the Ulster Bank Construction Purchasing Managers’ Index shows. Photograph: Alan Betson
Jobs and activity in construction are expanding at their fastest pace for several months, data published on Monday shows.
Employment in building is up 40 per cent in the first quarter of the year according to a quarterly survey by IrishJobs.ie, which tracks vacancy advertisements.
The index, which follows the sector’s performance on a monthly basis, rose to 60.8 in March from 57.9 in February, indicating a spurt in growth.
The PMI takes 50 as its benchmark. Any reading above that figure indicates that the industry expanded, while any result below that indicates that it shrank.
The 60.8 recorded in March was the highest figure recorded since last October, Ulster Bank said on Monday.
“The rate of overall expansion picked up to a five-month high last month, as the headline index rose to 60.8 from 57.9 in February, signalling robust expansion of activity,” he said.
“There was a very sharp acceleration in commercial activity, which took the commercial PMI to its highest level since last October, in the process leaving commercial as the strongest performing activity category last month.”
Commercial building leapt to 63.5 in March from 58.9 the previous month. Housing declined slightly to 61.3 from 63.3.
Civil engineering, which largely covers big public and mostly State-funded projects, dipped to 48.7 from 48.9.
Close to 60 per cent of companies questioned for the survey said they expected activity to continue growing over the next 12 months, Mr Barry pointed out.
“Other details from the survey also highlight the strength of the ongoing expansion in activity,” he said. “Strong demand for the services of construction firms was very much evident in further substantial increases in new orders, employment and input buying last month.
“And respondents continue to judge the sector’s outlook to be very favourable, with improving economic conditions, strengthening client demand and plans for business expansion cited as important sources of support.”
News of the growth in jobs and activity follows the release of quantity surveyors’ Linesight’s annual Ireland Handbook, which shows that building will be worth €17 billion to the Republic this year and employ 140,000 people.
Linesight believes that the employment figure could grow by 80,000 should the industry reach its optimum level, about 10 per cent to 12 per cent of the economy. Currently it accounts for about 7.5 per cent.
Recently the Economic and Social Research Institute predicted that continued growth in construction could mean the Republic could cut joblessness to 5.6 per cent within two years, which some regard as full employment.
However, the institute also warned that the “disproportionate” role that the industry was playing risked overheating the economy in much the same way as it did a decade ago, when the collapse of a property and building bubble triggered a recession that saw unemployment soar to 14 per cent.