The ups and downs of UK construction in August.

August was bleak month for industry

Published:  28 September, 2009

NOTTINGHAM: August was a cruel month for the construction industry, with over half of companies claiming that weak demand conditions are constraining activity.

According to the latest Experian monthly survey of contractors in August showed that, following three consecutive monthly improvements in the activity index, it edged back down to show a stronger rate of contraction.

Around 17% of respondents reported that financial constraints were affecting their output - a significant jump from the previous two months.

Five of the 12 regions saw a decline in their indicators, with Northern Ireland's dropping by six points. The East Midlands, in contrast, saw a 4-point rise, and broke into growth territory for the first time in 14 months. The indicator for Wales also rose above 50 in August.

Verity Howell, senior economist at Experian, said: "August's figures suggest that there is a real risk of a 'double-dipper' recession in the construction industry.

"The sector had seen some improvement in conditions in the past few months, but this was not the case in August.

"Whether this is just a blip or a more sustained deterioration remains to be seen. There were some encouraging signs across the regions, but Northern Ireland fell back after posting some substantial gains since the beginning of the year."

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