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Brexit Causes A Drop in Construction Stats

Due to Brexit repercussions causing enhanced caution around production processes, May has seen a weakening in industry conditions and plans.

A survey conducted by the IHS Markit for the Chartered Institution of Procurement showed its purchasing manager index falling by nearly 3% in May, suggesting that the sector is close to contracting.

Only one of the three sub-sectors of construction, housebuilding, saw an expansion throughout May. However, this is unable to compensate for the falls in the other areas of commercial and engineering work.

The results from the index released by CIP’s will be watched closely to evaluate the position of the economy and due to the recorded drop in production, attention will now be focused on the larger services in the sector.

Structural Defects Insurance

An associate director of HIS Markit, Tim Moore, explained: “May data reveals another setback for the UK construction sector as output and new orders both declined to the greatest extent since the first quarter of 2018. Survey respondents attributed lower workloads to ongoing political and economic uncertainty, which has led to widespread delays with spending decisions and encouraged risk aversion among clients.”

“Commercial building remained hardest-hit by Brexit uncertainty, with construction firms reporting the steepest fall in this category of activity since September 2017. Civil engineering work also dried up in May and a fourth consecutive monthly fall in activity marked the longest period of decline since the first half of 2013.”

The political uncertainty that is currently surrounding the UK is proving to have an adverse effect on the construction industry, with recent statistics showing a fall in commercial and civil engineering projects.

Specialists in Construction Insurance

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