Beard Construction comments on latest CIPS PMI data

06 March 2023

Following the release of the latest CIPS PMI construction data, which showed construction activity rose at the fastest rate in nine months in February, we have a comment from Beard Construction.

Fraser Johns, Beard finance director said: “After a two-month period of decline, it’s certainly encouraging to see a healthy rise in activity across the construction sector in February. Supply chain pressures softening and recession fears easing have been key drivers in boosting activity, new order levels and overall confidence.

“Last year, material costs in particular were much larger than expected, leading to a significant squeeze on live projects. It was one of many reasons why those without a strong balance sheet had nowhere to hide in 2022. So far this year though, increases – while still present, have started to come down and are closer to expectations, providing less volatility than in the previous 12 months.

“One area that is expanding is more specialised infrastructure projects in the likes of healthcare, education and local authority for both local and central government. This has certainly been the case at Beard. Although the economic outlook is far from rosy, it is less doom and gloom than what we have come to expect. This is helping to shift sentiment and encourage more clients to commit to projects once again.

“While this is all positive news, we are certainly not out of the woods yet, especially with high energy costs remaining a key factor. Businesses across the construction sector must still remain agile, especially those that rely on house building projects. With high interest rates still stifling housing activity, residential housebuilding remained a weak spot, decreasing for a third month running.”