Increase in construction activity, jobs & sentiment
The Irish construction sector posted another sharp rise in activity in November, helped by accelerated growth of new business. The rate of job creation also quickened, while sentiment among constructors reached a near-record high.
The Ulster Bank Construction Purchasing Managers’ Index, a seasonally adjusted index designed to track changes in total construction activity, posted 55.5 in November, below the reading of 56.3 from October but still signaling a sharp monthly rise in construction activity in Ireland. Activity has now increased in each of the past 27 months.
Commenting on the survey, Simon Barry, Chief Economist Republic of Ireland at Ulster Bank, noted that:
“The Irish construction sector continues to experience solid growth, according to respondents to the latest Ulster Bank Construction PMI survey. The headline PMI index fell a fraction in November but, at 55.5, it remains well above the 50 breakeven level and continues to signal widespread gains in activity. All three major sectors recorded expansion for the third month in a row, with the pace of activity picking up in commercial projects, and easing slightly in housing and civil Engineering.”
Furthermore, the ongoing increases in current and prospective activity levels continue to underpin rising demand for construction workers, with the Employment index also rising to its highest level since June. Finally, optimism levels among firms rose for the second month running and now stand at the third-highest in the survey’s fifteen-year history.
A pick-up in enquiries and an improving economic environment more generally are contributing to bullish sentiment among construction firms as the year draws to a close, with two-thirds of respondents expecting activity to increase over the coming twelve months.
The report reveals the strongest expansion seen in commercial activity. All three monitored sectors continued to post rises in construction activity. The fastest expansion was on commercial projects, the only category to see a quicker rise in activity than in the previous month. Housing activity increased at a sharp pace, albeit the weakest since August, while civil engineering again posted the slowest expansion of the three monitored categories.
