S&P Global’s October 2024 PMI’s have been released, detailing a smaller growth in the construction sector than in the previous report
The overall October 2024 PMI’s registered 54.3 in October, down from the 29-month high of 57.2 in September.
While smaller than the previous month, this ranking is still above the 50.0 mark and above the average seen in the first half of 2024, 51.4.
Civil engineering remains the best-performing
Civil engineering was given a rating of 56.2 for October, down from 59.0 in September.
Commercial Work also ranked well at 52.8, with housebuilding declining to 49.4, the first decrease in residential activity since June, albeit only slight.
Staff recruitment also raised in October, with job creation reaching a three month high, and greater staff demand being recorded in the face of a slight decline in business optimism.
Signs of recovery- despite lower optimism
Tim Moore, economics director at S&P Global Market Intelligence, said: “The construction sector signalled another month of solid output growth in October, despite being unable to match the highs seen in September. Business activity expansion was once again led by civil engineering work. Survey respondents widely commented on strong demand for renewable energy infrastructure projects.
“Commercial construction activity also increased again, albeit at the slowest pace since the current phase of expansion began in April. Improving domestic economic conditions helped to boost demand, but some construction companies reported delayed spending decisions ahead of the Autumn Budget. October data meanwhile indicated a decline in overall residential construction activity for the first time since June. Government policy uncertainty, fragile consumer confidence and elevated borrowing costs were all constraints on demand for house building projects.
“Total new work expanded at a solid pace in October, adding to signs of a robust improvement in order book pipelines across the construction sector in the second half of 2024. As a result, construction companies added to their payroll numbers at an accelerated pace. However, business optimism remained relatively subdued in comparison to the highs in the first half of the year, with output growth expectations now the lowest since December 2023.”
Fraser Johns, finance director at Beard, said: “After a 29-month high, it’s expected that output would ease slightly to ensure sustainable growth across the construction industry. However, the sector’s continued expansion points to promising opportunities ahead, with robust order books and a stabilised supply chain supporting new project starts and steady recruitment.
“We’re seeing these trends firsthand at Beard, with strong business momentum prompting high levels of job creation.
“As global events continue to create uncertainty, supporting client needs and supply chain resilience remain priorities as we move into 2025.”
