The UK's construction sector just had its best month since March

Emma Haslett
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Early Morning Views Over The River Thames
Construction in the UK grew faster than expected (Source: Getty)

Output in the UK's construction sector showed a surprise jump in December - causing the industry to enjoy its best month since March.

Markit's purchasing managers' index (PMI) for the sector rose to 54.2 in December, up from 52.8 in the previous month - despite economists expecting the figure to be flat. Any number above 50 denotes growth in the sector.

Today's figure follows an expectation-beating rise in November.

The figure was boosted by the fastest rise in new order volumes since last January, Markit said, while stronger demand led to sustained job creation and a broad-based upturn in business activity.

The report added that anecdotal evidence had suggested improving order books and a general rebound in business conditions had also pushed the figure higher.

Residential building activity continued to be the best performing sub-category, with the expansion of housing activity being the fastest since last January.

That is at odds with reports from Bovis Homes, whose shares dragged the rest of the UK's housebuilders lower during the Christmas trading period after it admitted its delivery volumes were lower than expected at the end of last year.

Tim Moore, senior economist at IHS Markit, warned undercurrents may hamper growth in the sector.

"All three main areas of construction activity have started to recover from last summer’s soft patch, but in each case growth remains much weaker than the cyclical peaks seen in 2014," he said.

“Housebuilding remains a key engine of growth for the construction sector, with the latest upturn the fastest for almost one year. Meanwhile, commercial activity was the weakest performing category in December, reflecting an ongoing drag from subdued investment spending and heightened economic uncertainty."

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