The construction sector unexpectedly shrank last month as weak demand for residential, commercial and public properties continued to plague the nation's builders.
The Markit/CIPS survey, where a reading above 50 represents growth, showed overall activity in the sector fell to 49 in June from 50.9 the previous month - the second lowest reading since February 2010.
Residential building was the worst performing area, while there was a decline in commercial construction, albeit marginally, for the first time in two and a half years.
Howard Archer, chief UK and European economist, said: "The construction sector is currently hampered by major headwinds, notably including public spending cuts, a weak economy, a struggling housing sector, and problems in getting funding for large-scale projects."
While the construction sector only accounts for roughly 7% of the total economy, it has weighed on overall output, declining by 3.9% in the second quarter of 2012, contributing to the 0.5% slide in gross domestic product (GDP).
However, the picture for the third quarter is mixed after figures showed a rebound for the manufacturing sector in August.
No comments:
Post a Comment