Latest data released by Markit/CIPS - 4 June 2020
- Prior 8.2
After the crash in construction activity in April, activity eased further in May but at a slower pace amid the gradual reopening of construction sites.
The overall situation remains rather severe still with Markit highlighting that there continues to be a rapid fall in new orders and project cancellations, with supply chain disruptions still widespread due to delay in deliveries and some ongoing business closures.
Markit notes that:
"A gradual restart of work on site helped to alleviate the downturn in total UK construction output during May, but the latest survey highlighted that ongoing business closures and disruptions across the supply chain held back the extent of recovery.
"It seems likely that construction activity will rebound in the near-term, as adaptations to social distancing measures become more widespread and the staggered return to work takes effect. However, latest PMI data pointed to another steep reduction in new orders received by UK construction companies, with the pace of decline exceeding the equivalent measures seen in the manufacturing and service sectors.
"Survey respondents often commented on the cancellation of new projects and cited concerns that clients would scale back spending through the second half of 2020, especially in areas most exposed to a prolonged economic downturn.
"With construction firms anticipating a reduced pipeline of work and fewer tender opportunities, business expectations for the next 12 months remained negative in May. Since the start of the lockdown period in March, business sentiment has remained more downbeat than at any time since October 2008."
