The latest Purchase Managers’ Index (PMI) for the construction sector has disclosed that the constructive industry suffered is largest drop in activity and work since the 2016 Brexit Vote in March 2018 due to severe weather caused by the “Beast from the East”.
The latest PMI came in at 42 for the construction sector, down from 51.4 in February and below the 50 mark point that separates expansion from contraction.
The City of London analysts had estimated a reading of 50.8.
Civil engineering saw its largest drop in activity in five years. Commercial construction also fell hard. Housebuilding, however, coped better in the month.
Tim Moore of IHS Markit, which compiles the survey, said: “Snow-related disruption was a key factor behind the marked decline in activity on site reported by survey respondents.”
In the instant wake of the June 2016 Brexit vote, the construction PMI reduced from 51.2 to 46 as builders and investors put projects and developments on immediate hold.
Nevertheless, by September, the index had bounced back sharply as general confidence was regained.
An outbreak of cold weather from Russia, bringing a dense snowfall, hit the UK on 24th February 2018. Another freezing wave, nicknamed the ‘Mini Beast from the East’ hit the UK on 17 March.
The latest PMI survey also showed new orders contracting for a third successive month.
“Though March’s figures could be viewed as a temporary blip, without a strong pipeline of work, and strong risk strategies in place, the sector’s health remains in question as we’re still a long way off seeing it operate the way it has over the last year,” said Duncan Brock of the Chartered Institute of Procurement & Supply.