Belfast Telegraph

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Builders hit again by decline in output

By Clare Weir

Published 03/10/2012

The UK construction sector continued to decline in September, a survey has shown, as residential building saw its biggest fall in nearly two years.

The Markit/CIPS survey recorded a reading of 49.5 in September, which is an improvement on the previous month's reading of 49 but still represents a decline in output as it falls below the no-change 50 mark.

Residential building was the worst performing category, continuing the trend seen throughout most of 2012, registering the worst drop since December 2010.

Commercial building also dropped at its fastest rate for just over two-and-a-half-years, although a return to civil engineering growth helped soften the overall downturn.

Economists said the figures knocked confidence that the nation's builders would eke out growth in the third quarter after dragging on the wider economy for a several months running.

New business decreased for the fourth successive month in September.

Construction companies widely noted that the current business climate remained unfavourable for securing new contracts, Markit added.

This in turn led to subdued confidence about the year-ahead outlook for output in the construction sector with the degree of positive sentiment about future prospects among the lowest seen since the start of 2009.

However, staffing levels increased in September following a stagnation during the previous period, albeit slower than its average pace prior to mid-2008.

And there was more bad news for the Bank of England as input price inflation accelerated for the third month running to its highest since March, driven by increased costs for fuel and a range of raw materials during the latest survey period.

Meanwhile a new scheme aiming to improve the environmental performance of the construction industry in Northern Ireland, has been launched by Environment Minister Alex Attwood.

Developed by the Construction Employers Federation with the support of the Northern Ireland Environment Agency and the Institute of Environmental Management and Assessment, the new system, called NVIR-O-CERT, will require participating companies to commit to continual environmental improvement.

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