- Prior 48.8
UK construction activity fell marginally in February as the data continues to point to improved demand conditions. Overall output levels are starting to stabilise now with business optimism improving to its highest since January 2022. S&P Global notes that:
“A stabilisation in house building meant that UK
construction output was virtually unchanged in February.
This was the best performance for the construction
sector since August 2023 and the forward-looking
survey indicators provide encouragement that business
conditions could improve in the coming months.
“Total new orders expanded for the first time since
July 2023, which construction companies attributed to
rising client confidence and signs of a turnaround in the
residential building segment. Meanwhile, the degree
of optimism regarding year ahead business activity
prospects was the strongest since the start of 2022, in
part due to looser financial conditions and expected
interest rate cuts.
“However, a protracted downturn in activity has
made construction companies cautious about their
employment numbers. Staffing levels dropped for the
third time in the past four months and the latest round
of job shedding was the steepest since November
2020. Purchasing activity also decreased in February,
but construction firms continued to cite supply side
challenges. Moreover, input costs increased for the
second month running as strong wage pressures and
renewed materials price inflation placed upward
pressure on operating expenses.”