Activity at construction companies declines for 47th month in a row

LAST month was another poor one for the construction industry as more firms cut jobs as workloads fell.

Irish construction activity continued to decline in April as new business fell further, according to the Ulster Bank Construction Purchasing Managers’ Index (PMI).

The index, which tracks changes in construction activity, fell to 43.7 in April from 46.1 in March. Activity at construction firms in Ireland has now decreased in each of the past 47 months.

Chief economist with Ulster Bank Simon Barry said the problems stand in marked contrast to the improving trends in the internationally-traded sectors of the economy.

“The manufacturing and services PMIs have been above the key expansion threshold of 50 for most of the past year, buoyed by strong gains in export orders.

“In contrast, the largely domestic-focused construction PMI is mired in contraction territory.”

Home-building fell to its lowest level since July 2010, as activity also fell at a faster pace in civil engineering.

Mr Barry said: “Poor demand in the sector resulted in further declines in both new orders as well as employment. Staffing levels at Irish construction firms have now consistently fallen for the duration of the past four years — again, leaving construction a distance behind manufacturing and services where the PMIs have begun to point to signs of job creation in recent months.”

Despite all this, confidence in an improvement in activity in the coming year has reached its highest level since January 2007.

New orders continued to fall in April, while workloads decreased further. Input prices rose sharply again, extending the current sequence of inflation to one year.