UK construction growth weakens in November

Construction workers

Growth in the UK building sector fell back in November after a surprise gain in October, a survey suggests.

The Markit/Cips Construction Purchasing Managers Index, which is based on a monthly survey of building firms, fell to 52.3, down from 53.9 in October. A value above 50 indicates growth.

November saw a rise in new contracts and the first increase in residential construction for six months.

Markit described growth as modest due to economic head-winds in the industry.

"Raw materials, energy and fuel prices continue to hinder the sector, construction companies cite these as the main contributing factors for high input prices which have increased for the 22nd month running," said David Noble, chief executive at the Chartered Institute of Purchasing and Supply.

Also on Friday, homebuilder Berkeley announced a 64% rise in pre-tax profits for the six months to the end of October, including an exceptional profit of £30m due to the sale of a subsidiary.

Nevertheless, the firm said it is currently operating against a backdrop of uncertainty in the economy and short-term volatility.

The construction company welcomed the government's announcement on Tuesday of measures to boost home-building including a £400m scheme to kick-start stalled construction projects in England and a mortgage indemnity scheme to help up to 100,000 people buy homes with a 5% deposit.

On Thursday, Markit/Cips data showed that the UK's manufacturing sector shrank at its fastest pace in 18 months.

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