Construction output grew at the fastest rate in six and a half years in March as a combination of delayed projects getting the go-ahead and a boost in housebuilding spurred on the industry.
IHS Markit’s construction Purchasing Managers Index registered 61.7 last month, a sharp increase from a reading of 53.3 in February.
The latest reading, which smashed analyst expectations of a score of 54.6, is the strongest rate of construction output growth since September 2014.
Housebuilding led the way with a reading of 64.0, its fastest rate of growth since last July.
But strong increases from commercial construction and civil engineering meant the readings for both segments were their highest since the second half of 2014.
Duncan Brock, group director at the Chartered Institute of Procurement & Supply, described the readings as “spectacular”.
“Construction was full of the joys of spring in March with a sudden leap into solid growth fuelled by across the board rises in workloads in all sectors.
“The commercial pipeline was particularly spectacular giving its best performance since late-2014.”
As a result of the upturn, the sector also saw the fastest boost in job creation since December 2018.
Steve Plaskitt, partner at accountants MHA, said that the support for the housebuilding and construction sectors announced in this spring’s Budget were behind the figures.
“The spring budget was a boon for both house buyers, who stand to benefit from the extension and phased ending of the Stamp Duty holiday, and house builders, who will hope that the government’s guaranteed support for 95 per cent mortgages until the end of 2022 will drive demand.
“The government’s infrastructure spending, such as the £27bn earmarked for roadbuilding, is also impressive and will create much needed stimulus for the industry. Collectively these measures will underpin performance in the sector for the months ahead.”
Today’s figures paint an ever-more rosy picture for the UK’s economic recovery. They come as the FTSE this morning wiped out all of its losses from the pandemic.
And yesterday IHS Markit’s services PMI showed that the country’s dominant services industry also returned to growth in March.