UK construction activity plummets
LONDON, June 3 (Reuters) – British construction activity dropped last month at its sharpest pace in at least a decade as falling house prices and tight credit took their toll, a survey showed on Tuesday.
The Chartered Institute of Purchasing and Supply’s construction PMI fell to 43.9 in May from 46.1 in April. That was the third consecutive month of decline and weakest reading since the survey began in 1997. Any reading below 50 signals contraction.
Only one of the three subsectors – civil engineering registered improved activity in May as conditions in both the housing and the commercial sectors worsened significantly.
The sub-index measuring housing activity fell to 32.7 from 40.3, a series low. The commercial sub-sector also experienced its sharpest drop in activity levels since the survey began, although it was not as extreme.
“Purchasing managers saw overall activity levels in the UK construction industry decline at the sharpest pace since the PMI survey began in April 1997, with the housing sector worst hit by the effects of the credit crunch,” said Roy Ayliffe, Director of Professional Practice at the institute. “May data for the sector heralded a further, more marked, contraction in levels of new business and, notably, the use of sub-contractors.”