CIPS construction activity figures provide a reality check
The construction survey results from the buyers’ body CIPS should provide a reality check on those who believe talking up the industry will help.
For those looking at the situation closely the disastrous figures for February should come as little of a shock.
The summary of the data provided reads: “Total business activity fell at an unparalleled rate in the survey’s history, while declines in new orders, employment and purchases all accelerated.”
Little more really needs to be said. But comparing commentary from last month’s release makes for quite and interesting juxtaposition.
Here is a section of the commentary from last month: “A number of UK constructors believed that they were over the worst in January, and were looking more hopefully towards the coming year than they have been in recent months.”
Now a slice of this month’s commentary: “Abysmal February data from the UK construction sector marks a whole year of decline in the industry and has put paid to any hopes of improvement following a slight rise in the PMI index last month.”
As I argued when the CIPS put out its January figures, false hope is dangerous. It leads to bad policy making and delays the action that is needed to fix the problem.
Be under no illusion the next few months, years perhaps will be tough. That is no reason to be despondent. It is just how it is. Little can change that. The challenge is to find ways to speed the recovery and ease the pain of the downturn.