Building activity jumps

Construction output is still 16 per cent below its pre-recession peak

Building activity surged in July, according to the latest snapshot of the beleaguered construction sector. The Markit/CIPS index shot to 57, up from 51 the previous month. Any figure above 50 represents an expansion. That was well ahead of City economists’ expectations for a 51.5 reading. The increase was driven by residential construction, suggesting that the Government’s various home buying subsidies are having an impact.

Construction output is still 16 per cent below its pre-recession peak, but the survey implies the sector is now growing at its fastest pace since June 2010.

In a further signs of a resurgent housing sector, Nationwide reported that average UK house prices rose 0.8 per cent in July, making them 3.9 per cent more expensive than a year earlier. “Signs of a modest improvement in wider economic conditions and further modest gains in employment are likely to be lifting buyer sentiment” said Robert Gardner, chief economist of the building society.

Another survey today showed Britons are increasingly confident about their employment prospects and personal finances.

Almost a quarter of Britons felt positive about their job prospects in the second quarter of the year according to the Nielsen Global Survey. That is the highest proportion since the start of the recession in 2008.The survey also found the proportion of Britons who feel good about their personal finances has climbed to 41 per cent, up from 36 per cent in the first quarter.