Construction sector just a 'small nudge' away from recession as Brexit uncertainty weighs on firms - Mail Online
- Date: 04/02/2019
By Camilla Canocchi for Thisismoney.co.uk
The construction sector could only need a 'small nudge' to fall into recession after suffering another slowdown as Britain’s builders stay put amid growing Brexit uncertainty. The latest Markit/CIPS UK Construction purchasing managers' index dropped to 50.6 for January, from 52.8 in December, marking the slowest growth since March last year.
Phil Harris, Director at BLP Insurance, said that if it wasn’t for taxpayer-backed loan schemes like Help to Buy, the residential sector would already be in reverse.
‘Small residential building contractors, the lifeblood of the sector which have skin in the game on a personal level, are minding their costs carefully and are not committing to building new units until they are certain that they have sold the properties they have already finished,’ Harris said.
‘Without "Help to Buy" and "Shared Ownership", the residential sector would have undoubtedly dropped under the growth threshold. These finance schemes, whilst providing life support for the residential market and keeping prices fairly buoyant, are in turn exacerbating the long standing affordability problems for consumers.
‘With profit margins under continuing pressure, the financial wobbles at Interserve and Kier have added to the lack of confidence within contracting and has contributed to a number of new commercial projects being put on hold.'
Read the full article on Mail Online: