Construction data boosts UK economy

 

The nation's builders saw new orders rise at the fastest rate in four-and-a-half years last month, a survey said today, further boosting hopes that the UK has dodged another recession.

The closely watched Markit/CIPS purchasing managers' index survey for overall construction output, in which a reading above 50 represents expansion, rose to 56.7 in March from 54.3 in February, the sharpest expansion in 21 months.

A general improvement in market activity boosted tenders and saw long-running negotiations closed as new orders rose at their fastest rate since September 2007, Markit said. Growth was seen across all construction areas - civil, commercial and housing.

The upbeat survey comes after the equivalent reading for the manufacturing sector hit a 10-month high in March, adding to expectations that the economy returned to growth in the first quarter of 2012, after shrinking 0.3% in the final three months of last year.

The commercial sub-sector, which covers shop and office space, was the strongest performing, although civil engineering activity, such as London's Crossrail project, strengthened at its fastest rate in a year.

A slight increase in residential construction was recorded, Markit added.

The data also showed a modest pace of job creation and an increased use of contractors, reflective of the growth of both output and new orders, Markit said.

Input prices faced by UK construction companies rose sharply in March, in line with the increases faced by manufacturers, as revealed in yesterday's survey.

High hopes for new marketing initiatives, a more buoyant outlook among clients and new tender opportunities meant that business confidence for the next year hit a near two-year high.

Chris Williamson, Markit chief economist, said the survey will "raise hopes that the country has avoided a slide back into recession".

But he added: "Looking ahead, the lack of big new projects such as Crossrail and the Olympics means expectations about the year ahead continued to run well below the pre-crisis peaks."

The construction and manufacturing surveys come after the Organisation for Economic Co-operation and Development (OECD) said the UK economy shrank in the first three months of the year, meaning it is officially in recession.

However, the OECD forecast contradicted many economists' predictions, after previous PMI surveys showed modest growth in the manufacturing industry and powerhouse services sector in January and February.

Blerina Uruci, economist at Barclays Capital, said: "Overall, today's PMI survey provides something to cheer about regarding the performance of the UK economy in the first quarter of this year."

PA

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Evening Administrator

£8 per hour: Recruitment Genius: This Pension Specialist was established early...

Guru Careers: Executive Assistant / PA

£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...

Ashdown Group: Graduate Application Support Analyst

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Reach Volunteering: External Finance Trustee Needed!

Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...

Day In a Page

War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable
Living with Alzheimer's: What is it really like to be diagnosed with early-onset dementia?

What is it like to live with Alzheimer's?

Depicting early-onset Alzheimer's, the film 'Still Alice' had a profound effect on Joy Watson, who lives with the illness. She tells Kate Hilpern how she's coped with the diagnosis
The Internet of Things: Meet the British salesman who gave real-world items a virtual life

Setting in motion the Internet of Things

British salesman Kevin Ashton gave real-world items a virtual life
Election 2015: Latest polling reveals Tories and Labour on course to win the same number of seats - with the SNP holding the balance of power

Election 2015: A dead heat between Mr Bean and Dick Dastardly!

Lord Ashcroft reveals latest polling – and which character voters associate with each leader
Audiences queue up for 'true stories told live' as cult competition The Moth goes global

Cult competition The Moth goes global

The non-profit 'slam storytelling' competition was founded in 1997 by the novelist George Dawes Green and has seen Malcolm Gladwell, Salman Rushdie and Molly Ringwald all take their turn at the mic
Pakistani women come out fighting: A hard-hitting play focuses on female Muslim boxers

Pakistani women come out fighting

Hard-hitting new play 'No Guts, No Heart, No Glory' focuses on female Muslim boxers
Leonora Carrington transcended her stolid background to become an avant garde star

Surreal deal: Leonora Carrington

The artist transcended her stolid background to become an avant garde star
LGBT History Month: Pupils discuss topics from Sappho to same-sex marriage

Education: LGBT History Month

Pupils have been discussing topics from Sappho to same-sex marriage
11 best gel eyeliners

Go bold this season: 11 best gel eyeliners

Use an ink pot eyeliner to go bold on the eyes with this season's feline flicked winged liner
Cricket World Cup 2015: Tournament runs riot to make the event more hit than miss...

Cricket World Cup runs riot to make the event more hit than miss...

The tournament has reached its halfway mark and scores of 300 and amazing catches abound. One thing never changes, though – everyone loves beating England
Katarina Johnson-Thompson: Heptathlete ready to jump at first major title

Katarina Johnson-Thompson: Ready to jump at first major title

After her 2014 was ruined by injury, 21-year-old Briton is leading pentathlete going into this week’s European Indoors. Now she intends to turn form into gold
Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot