Activity in the construction sector continued to deteriorate in January, although the rate of decline eased to its slowest rate in five months, according the latest Ulster Bank Construction PMI survey.
The bank's index rose from 33.1 in December to 36.1 in January, its highest level since August. Any rating below 50 indicates a decline in activity.
However, the data still indicates a substantial fall in activity during the month as conditions remain “fragile”, the survey said.
Activity in the building sector has now decreased for 31 consecutive months since June 2007.
The survey showed the rate of contraction in new business at Irish construction firms eased in January to its slowest rate of decline since October 2007.
However, the decline in new orders – the 34th in successive months – was still substantial with firms reporting a lack of available tenders, the survey said.
The steepest rate of decline was in the civil engineering sector, with activity on these projects falling for a 26th consecutive month.
The commercial sector registered the weakest decline in January, although the contraction was still substantial.
Ulster Bank’s chief economist Simon Barry said: “The January survey of the Ulster Bank Construction PMI indicates that there was some slight easing in the rate of contraction in activity last month”.
“At 36.1, the headline PMI continues to point to pronounced weakness in activity levels but it did rise to its highest level since last August.”
He said there was no indication of any improvement in “employment dynamics”, as the jobs index of the survey fell marginally and remained consistent with a sector that is “shedding labour”.
The survey indicated a 10-point jump in the future expectations index which rose to a 31-month high.
“The January survey picked up a clear improvement in optimism as respondents expressed an expectation that the wider economy will improve over the coming year,” Mr Barry said.