After a slow start to the year, May saw a huge rebound in the amount of construction being carried out in the UK, which was largely propped up by residential house building. This is following a ‘soft patch’ that took place at the beginning of 2017.
Unfortunately, the prices of working materials continues to rise, but the overall rate of inflation has steadied from the spike at the start of the year.
The main reason for this increase in work is the sudden rise in residential house building. Which has rebounded strongly from a 7 month low in March. This increase is actually the fastest since December 2015. The data from May also shows strong increases in civil engineering and commercial building.
Somewhat unfortunately, this sharp increase in demand lead to a shortage materials, and suppliers delivery times lengthening as they struggle to keep up with the increased demand. Weak exchange rates from the political unrest lead to intense negotiations between suppliers, however the time for peak price hikes has now passed.
Despite the increase in costs and difficulty sourcing materials the increase in work available is a boon for the construction sector.
One of the best aspects of this increase in productivity, aside from the economical benefits, is the creation of jobs. For the second month in a row job creation and staff recruitment both rose. Along with this material buying also increased in accordance with the increased workload. All of which will have a positive snowball effect on the construction industry.
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