Election uncertainly blamed for slowdown across the UK construction sector

The UK construction market experienced a slowdown in April, with output and new orders expanding at the slowest rates since June 2013, according to the latest Markit/CIPS UK Construction survey. Although the growth of commercial work was the least marked since August 2013, many survey respondents suggested that underlying conditions remained favourable, but some clients had delayed decisions ahead of the general election. Looking ahead, confidence regarding the 12-month outlook dipped from the nine-year high seen in March, but remained stronger than its long run average. A number of firms cited optimism that underlying demand would continue to improve, while others suggested that the removal of election related uncertainty would help support new business gains.

Tim Moore, Senior Economist at Markit and author of the Markit/CIPS Construction PMI® , said: “April’s survey highlights another growth slowdown across the UK construction sector, with new work expanding at the weakest pace for almost two years.

“The uncertain general election outcome appears to have put some grit in the wheels of decision making. Construction firms widely noted delays with clients’ budget setting and a reduced propensity to commit to new projects. “

He added: “Despite experiencing pre-election risk aversion among clients in April, construction companies indicated a strong degree of confidence regarding the year-ahead outlook.”

David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply, said: “The General Election has given the sector pause for thought as procurement and supply management professionals reported a slowdown in the pace of new construction orders growth.

“Though the index still remains in positive terrain, this deceleration has been attributed to project delays and hesitancy as the country prepares to vote.”