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The construction industry has now been in decline for two years, according to the latest CIPS/Markit construction purchasing managers’ index.
The index activity reading for January was 48.6, up from 47.1 in December, but still below the 50 point mark which indicates decline.
The index has now posted a reading below 50 each month for the past two years, though January’s figure is the smallest fall in activity during the period of contraction.
House building was the only area of construction activity monitored by the survey to record growth in January, as has been the case for the last five months.
CIPS chief executive David Noble said: “Construction continues to be the worst performing sector of the UK economy – struggling in the face of credit supply shortages and overall economic uncertainty.
“Purchasing managers said the widespread chaos caused by the snow in January didn’t help an already fragile industry with new orders disappointingly low.
“A wider outlook for 2010 reveals a number of headwinds. There are concerns that the aftermath of the General Election will see the public purse drawn tighter leading to few major infrastructure investments outside of the Olympics and Crossrail. What’s more, though we’re starting to see jobs cut at a slower rate, there is concern that as recession carves out a new shape for the industry, these positions will never be refilled.”
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