THE EMBATTLED CONSTRUCTION industry is finally picking up as the sector recorded its fastest hike in new business for a decade.
Ulster Bank’s construction purchasing managers’ index (PMI), a key indicator of planned activity in the industry, noted the second-biggest rise in activity since surveys began in 2000 and the highest since November 2004.
Better economic conditions have been fuelling more construction, although positive figures from this year have come off a low base after years of pent-up demand during the recession.
The index had been sitting in negative territory – indicating orders were drying up, rather than increasing – for about 6 years between mid 2007 and 2013.
Both housing and commercial construction recorded big increases for October on the back of rapidly rising property prices and rents in both sectors.
Civil engineering activity also hit positive territory for the first time since late 2007, although the increase was very small.
That’s some good news for construction jobs… finally
Ulster Bank’s chief economist Simon Barry said the industry’s employment index had also hit a 10-year high, which showed the pace of hiring was increasing for construction jobs.
Moreover, confidence about the construction outlook over the coming twelve months also remains elevated, with sentiment close to record highs again last month, partly reflecting optimism surrounding the wider Irish economy,” he said.
Figures above the 50-point line indicate growth, below the line means employment is shrinking
Source: Ulster Bank construction PMI
The size of the sector’s workforce shrunk from about 274,000 in mid 2007 to only 100,000 in 2012, according to CSO figures.
About 29% of the businesses that took part in the Ulster Bank survey increased employment in October and sub-contractor usage went up for the eighth consecutive month.