Brexit Worries Spark Construction Slowdown

The UK construction industry Purchasing Managers’ Index (PMI) showed that construction suffered another blow in December. It fell from 55.8 in July to 52.9 in August, and then again from 53.4 in November to 52.8 in December. The PMI is regarded by the Treasury and the Bank of England as an indicator of what’s happening in the UK economy. They both take it very seriously as a gauge of what is happening in the economy. Any number over 50 indicates growth, so although there is a fall and it’s not good, it could be worse.

Image Credit

Slowdown

In December, house-building slowed and civil engineering was the worst-performing area in the whole construction sector. While new orders for commercial work were subdued (which some reports said was as the result of the wet weather), the commercial area still performed best in the whole construction sector. One possible reason for the slowdown, according to some experts, is that companies are reluctant to commit to long-term commercial building projects because of future uncertainty caused by Brexit.

Image Credit

Is This the Real Thing? Or Is It Just Fantasy?

There are those who, on reading these reports, think that this is just more Brexit scare-mongering. And they have good reason to think so. The Financial Times reports that despite these setbacks, 2019 should be a better year. In fact, recently, there are high numbers of jobs being advertised by construction companies Manchester – this is one of the areas where 249 were advertised on one website.

Government Spending

In addition, government investment may help in some areas, even if business investment slows down. What construction companies call “the three Hs of Britain’s infrastructure pipeline” – HS2, the Hinckley Point nuclear power plant and Heathrow’s third runway – have all been approved by government and will all feed money into the construction sector. There is set to be an increase in investment to the tune of over 10% in 2019-20, which will be another boon to the sector.

Manchester

Meanwhile, there are construction companies Manchester that should be clapping their hands in glee because of the new projects that are going ahead.

The whole refurbishment of the Boddington’s brewery site and the proposals put forward by ex-England footballer Gary Neville for the St Michael’s site are major projects that will continue the city’s transformation.

 

About the author

Sue

View all posts