Monday, October 08 10:40:05
Activity in the embattled Irish construction sector continued to decline during September as new business continued to decrease, according to the latest Ulster Bank Construction Purchasing Managers' Index (PMI).
It said that falling workloads also led to reductions in employment and purchasing activity.
Meanwhile, the rate of input cost inflation quickened to a sharp pace as higher oil and fuel costs led to rising input prices.
The index - a seasonally adjusted index designed to track changes in total construction activity - registered 41.9 in September, following a reading of 40.7 in August. Although this pointed to a weaker reduction in activity, the pace of decline remained sharp. Panellists mainly linked the latest fall in activity to lower new orders amid weak client confidence.
"As has been the case for well over five years, the Irish construction sector continues to experience declines in activity according to the latest reading of the Ulster Bank Construction Purchasing Managers Index. The survey results for September show that while the pace of contraction eased very slightly last month, the sector continues to exhibit widespread weakness. The overall PMI edged higher from 40.7 in August to 41.9 in September, but at this level remains some distance from the breakeven level of 50 as all three sub-sectors continue to experience substantial declines in activity. The rate of contraction did ease a touch in the Housing and Commercial arenas, but there was a pronounced weakening in Civil Engineering where activity is now falling at its sharpest pace since the end of 2010," said Simon Barry, Chief Economist Republic of Ireland at Ulster Bank.
"In contrast to the persistent declines in construction, last week's Manufacturing and Services PMIs both recorded expanding activity levels, highlighting the ongoing divergence in trends between many areas of domestic demand which continue to struggle and the internationally-traded sectors of the economy which are managing to hold up relatively well. There appears to be little reason to expect this pattern to change much in the near term, with the latest PMIs showing incoming new business levels on the rise in manufacturing and services but still on the slide in construction."