Construction market feels February chill
It may not have come as a great surprise but the latest figures for output in the construction sector make for gloomy reading.
According to the latest report from the Markit/CIPS purchasing managers index the sector's output fell even more sharply in February than it had done for the past three years. This news comes against a backdrop of poor figures in January and a pattern of negative growth in recent quarters.
The situation is bound to increase pressure on the Chancellor to focus his attention in the pending budget on putting greater effort into investing in areas such as residential development and infrastructure. Whilst the wider economy flirts between marginal levels of growth and contraction, construction (which accounts for roughly 8% of GDP but which also acts as a substantial barometer of the state of the nation) can only dream of such 'positive' returns.
It seems that the measures announced in the Autumn Statement (which included a £5 billion injection into projects which include roads and schools among the main beneficiaries) have had only limited effect on the sector. Surprisingly, perhaps, this news comes despite there having been some encouraging performance in the housing sector, which saw an improvement for the first time since last May.
Construction is, of course, more prone to the weather than many sectors and the start to 2013 has not dealt an especially friendly hand. However, the extent of the decline has led market analysts to say that the drop has not been all down to the snow. The industry will, more than ever, be hoping for some good news when George Osborne appears at the despatch box on 20 March.