According to the Ulster Bank Construction PMI Report, the growth rate of total activity and new orders in the Irish construction sector accelerated during February, while job creation remained at a near-record pace. Companies remained optimistic regarding the prospects for growth of activity over the coming year, with optimism supported by improving economic conditions and predictions of further rises in new business.
Growth has now been recorded on a monthly basis throughout the past three-and-a-half years.
Commenting on the survey, Simon Barry, Chief Economist Republic of Ireland at Ulster Bank, noted that “Irish construction activity continues to grow at a robust pace according to the latest results of the Ulster Bank Construction PMI. The pace of activity growth picked up last month as the headline PMI rose to 57.9 in February from 55.7 in January, consistent with further rapid expansion and interrupting a three-month sequence in which growth had eased modestly. There was a very encouraging acceleration in residential activity which took the Housing PMI back to levels last seen in November, in the process keeping housing as the strongest performing activity category last month. The pace of growth in Commercial activity also accelerated in February and remains sharp. Civil Engineering continues to lag behind the other sectors, with respondents reporting a fourth consecutive monthly decline in activity. Survey respondents mentioned that improving economic conditions continue to underpin strong client demand with the New Orders Index edging higher in February from already-elevated levels. In turn, this solid growth in new business continues to underpin increased demand for construction workers. Indeed, the Employment Index remains close to record levels, with this month’s reading representing the third-fastest rate of job creation in the survey’s 16 ½ year history. Last week’s National Accounts figures showed that construction was not only the fastest growing broad sector of the economy in 2016, but recorded its fastest year of output growth in over 20 years. The PMI survey results so far this year suggest that the sector is sustaining strong growth momentum through the early months of 2017.”
Both the housing and commercial construction categories saw a strong rise in activity in February, while civil engineering activity decreased at a slower pace than it had been in previous months. For the second month in a row, the sharpest increase in activity was on residential projects.
New business rose at a faster pace in February. This is in line with the trend in total activity, with improving economic conditions helping to secure new orders.
Constructors responded to increased workloads by taking on extra staff, with reports that employment had been raised to support business growth.
Higher new orders also encouraged firms to increase purchasing activity, and the rate of expansion remained sharp, despite easing for the fourth consecutive month. This increase in demand for inputs put capacity pressure on suppliers, resulting in lengthened delivery times.
Read the article online at: https://www.worldcement.com/europe-cis/15032017/irish-construction-activity-picks-up-in-february/
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