Business

UK construction growth 'at six-year high' in October

Houses under construction
Image caption UK construction activity grew at its fastest pace for six years last month

UK construction activity grew at its fastest pace for six years last month, an influential survey has suggested.

The Markit/CIPS construction purchasing managers' index (PMI) rose to 59.4 in October, up from 58.9 in September.

It is the sharpest increase since September 2007, and higher than economists had forecast.

Any figure greater than 50 indicates expansion. The construction PMI has now been above that level for six months in a row.

"UK construction output continues to rise like a phoenix from the ashes, with housing, commercial and civil engineering activity all seeing strong rates of expansion at the start of the fourth quarter," said Markit economist Tim Moore.

Housing activity was the strongest performing sector in the survey. However, the pace of its expansion slipped slightly from September's 10-year high.

Construction was one of the hardest-hit sectors of the UK economy in the aftermath of the 2008 financial crisis, as the government and businesses axed building projects to save money.

The figures are the latest in a series of positive figures on the UK economy and follow a strong reading for the UK manufacturing sector on Friday.

However, IHS Global Insight economist Howard Archer said construction was a relatively small part of the UK economy.

"It needs to be remembered that the sector only accounts for 6.3% of national output," he added.

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