The report from S&P Global and Chartered Institute of Procurement
& Supply (CIPS) revealed Thursday that the pace of growth of the companies’
activity in the UK’s construction sector decelerted in June.
According to the report, the Markit/CIPS Purchasing Managers' Index
(PMI) for the UK’s construction sector fell to 52.2 in June from an unrevised 54.7
in May. This latest reading indicated that construction activity in the UK
continued to expand for the fourth consecutive month in June, albeit at a weaker
pace than in the previous two months.
Economists had expected the indicator to drop to 53.6. The 50 mark
divides contraction and expansion.
According to the report, new orders increased for the fifth consecutive
month amid successful tendering and a rise in client activity, though at the slowest
pace since February with some respondents linking this to election uncertainty.
Despite the softer growth in new orders, construction firms responded to
greater workloads by employing more staff for the second month running. As a
result, the rate of job rose to the highest level since August 2023. Construction
companies also expanded their use of sub-contractors at a solid pace as well as
increased their purchasing activity for the second month running. On the price
front, input costs went up only slightly again in June as some suppliers capped
price increases, aiming to secure new business. The rate of inflation inched up
amid rising costs for some raw materials, but remained well below the series average.
Meanwhile, sub-contractor rates also moved up modestly, and at the weakest pace
in four months.