December saw accelerated residential and commercial building activity with construction sector output growth quickening to a five-month high.
The latest edition of the monthly Ulster Bank construction purchasing mangers’ index (PMI) — the main barometer of health for the building sector — delivered a reading of 58.6 points; well above the neutral 50 point mark which separates an industry in growth mode from one in contraction and up from a reading of 55.5 in November.
“Overall activity trends were buoyed by a strong acceleration in both commercial and housing activity, with the pick-up in the residential arena a particularly welcome development given concerns about the housing supply shortfall.
"Growth in civil engineering continues to lag some way behind the other sectors, though it did record a fourth consecutive month of expansion last month,” said Simon Barry, Ulster Bank’s chief economist for the Republic.
“Overall, the December survey results indicate that Irish construction firms are reporting solid momentum as a second full year of recovery drew to a close.
"The new orders index continues to show vibrant expansion, with increasing enquiries for new business pointing to a healthy near-term pipeline of activity.
"And firms certainly remain optimistic about prospects for the year ahead, with sentiment remaining close to record levels despite easing slightly from November,” he added.
The December survey also delivered good news on the employment front with the month showing the fastest rise in hiring levels, at construction firms, since last June.
Additionally, the actual rate of job creation quickened for a second consecutive month in December.
“According to respondents, higher workloads was the key factor leading to growth of activity during the month.
"New business increased sharply again, with panellists linking the latest expansion to higher enquiry numbers. New orders have now risen on a monthly basis throughout the past two and a half years,” said Mr Barry.
With regards sentiment, the survey shows that firms are now at near-record high levels of optimism despite the reading easing from November’s survey.
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