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Construction employment sees strongest rise in 6 months – PMI

Construction firms expanded at a rapid pace in February, leading to strong job creation in the sector.

The latest Ulster Bank construction PMI, a monthly report measuring sentiment and activity in the sector, posted a reading of 59.2 in February.

This was down from the eight month high of 61.4 in January but still showed that activity in the industry continues to  grow strongly.

Activity in construction, as measured by the PMI, has shown consistent growth every month now for four and a half years.

The latest PMI showed that employment rose at its fastest pace in six months during February.

All three sectors – housing, commercial and civil construction – showed sharp rises in activity during the month. Ulster Bank noted that housing activity was at a ten month high.

Today’s index also showed that new orders increased sharply in February, with companies linking higher new business to improving conditions in the economy overall.

Companies were also able to take advantage of higher demand to raise their selling prices last month, and so the rate of input cost inflation remained high.

Construction firms are also optimistic that improving economic conditions and market confidence will lead to increased activity over the coming year.

Ulster Bank’s chief economist Simon Barry said one of the more encouraging signs from the February index was the further acceleration in housing activity, where growth picked up to a ten month high.

“Growth in commercial activity was also very strong, albeit the pace of expansion eased slightly in February. And civil engineering recorded a third consecutive month of expansion, though the pace of growth was more modest than in the other sub-sectors,” the economist added.

He also noted that sentiment among construction companies rose to an eight month high and was one of the strongest readings since the survey began over 17 years ago, with over 60% of firms anticipating further activity gains in the coming 12 months.