THE LEVEL OF house construction remains at a very low level but new evidence suggests that the sectors is expected to grow in the near future.
The Ulster Bank Construction Purchasing Managers’ Index for July shows that the number of new orders is now at the highest level since November 2004.
The index measures growth as any reading above 50 and recorded the level of construction activity at 62.6 in July, up from 59.9 in June. This is the biggest monthly rise since April.
The July bump also now means that activity has risen in 11 consecutive months according to Ulster Bank’s chief economist Simon Barry:
Overall activity increased sharply in July, with the rate of growth quickening to its fastest in three months. The July results marked the eleventh consecutive month of expansion among Irish construction firms – an important indication that a sustained recovery is taking hold.
In particular, the rate of expansion in activity on residential projects was the sharpest in the history of the survey which began in June 2000.
The growth in construction activity growth has led to better employment prospects in the the sector and an increase in the charges for sub-contractors according to Ulster Bank..
Barry also argues that we will soon start to see the effect these increases in demand have on the construction sector.
“The rate of growth of new orders picked up markedly to the strongest since November 2004, thus providing a solid basis for expecting that overall activity levels should continue to expand solidly in the months ahead.”
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