The UK construction sector has recently seen its most significant growth in over two years, with data released on 6th June 2024 showing strong improvements. The S&P Global Construction Purchasing Managers’ Index (PMI) for May 2024 reached 54.7, a notable increase from 53 in April. Any PMI reading above 50 signals expansion, and this latest figure marks the highest level since May 2022, a period of recovery following the Covid lockdowns and the economic measures introduced by the former chancellor, Kwasi Kwarteng.
This upward trend persisted into the third quarter, with the index rising further to 55.3 in July, up from 52.2 in June. This sustained growth marks the fifth consecutive month of expansion in the construction sector, largely driven by a revitalised housing market and robust civil engineering projects. The latter saw its fastest growth in almost two-and-a-half years.
New orders have been steadily increasing for six months, with the strongest pace of growth seen in July, the best since April 2022. The sector’s improved performance can be attributed to a rise in customer confidence and demand, with many clients resuming previously postponed projects. This surge in business has been a key driver of the sector’s continued expansion.
Nigel Jordan, Managing Director of Devine Group, expressed optimism about the sector’s future, citing new projects and partnerships with major developers like Persimmon Homes and Vistry Group. He highlighted the positive impact of these collaborations on construction output, particularly in Thatcham and North Whiteley.
Looking ahead, the sector’s outlook remains positive, with nearly 53% of survey respondents anticipating further growth over the next 12 months. The ongoing improvement in client confidence is expected to keep driving new orders and support continued expansion in the industry.
The UK construction sector is on a strong upward path, buoyed by growing demand and increased confidence, which should ensure sustained growth in the coming months.
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