Builders face gloom despite return to growth

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The construction sector returned to growth last month, a survey said yesterday, although housebuilders and commercial developers continue to weigh heavily on the industry.

The Markit/CIPS survey, where a reading above 50 represents growth, showed overall activity in the sector rose to 50.5 in October from 49.5 the previous month.

The rise was driven by moderate growth in the civil engineering sector for the second month running as residential building activity declined for the fifth month in a row.

Commercial activity also dropped in October, but at only a marginal pace.

Chartered Institute of Purchasing & Supply (CIPS) chief executive David Noble said the nation’s builders were heading into a “long, dark winter”.

He said: “Despite marginal growth in October, the prospects for the construction sector are bleak as firms prepare for the worst.”

The October headline reading was much weaker than the average – 56.3 – seen in the decade leading up to the global financial crisis in 2008.

The weak-performing construction sector has dragged on the economy this year, acting as part of the driving force behind the double-dip recession. And even in the third quarter, when the UK left recession, the construction output still declined, shrinking 2.5 per cent.

The survey comes after the equivalent report for the manufacturing sector revealed that activity shrank for the sixth month in a row in October.