UK Construction woes continue as sector suffers worst month in a decade

UK Construction woes continue as sector suffers worst month in a decade

Once again, fears around the uncertainty of the date and form Brexit will take has led to risk aversion amongst clients who are waiting to see what direction both Brexit and the economy will take.

This week’s figures bring no relief for the UK’s beleaguered construction sector as it saw its steepest decline since the recession that followed the financial crisis. The figures are not great news for the economy coming just one day after British factories reported their worst contraction in six years. The HIS Markit/CIPS UK Construction Purchasing Manager’s Index (PMI) fell to 43.1 from 48.6 in May, with figures once again much worse than the economists’ forecasts. These figures are the worst reported since April 2009, with anything under 50 showing a contraction in the market.

Once again, fears around the uncertainty of the date and form Brexit will take has led to risk aversion amongst clients who are waiting to see what direction both Brexit and the economy will take.

Activity and new work both fell, and all areas have been affected, with commercial work being hardest hit seeing a fall for the sixth consecutive month. Housebuilding reported its largest decline for three years and civils contracted at its fasted rate since October 2009. With incoming new work falling at the fastest pace for a decade there seems to be little chance of recovery in the sector soon.

HIS Markit associate director Tim Moore said, “Construction companies reported a continued brake on commercial work from clients opting to postpone spending, with decisions on new projects often pending greater clarity about the path to Brexit.”

Chartered Institute of Procurement and Supply (CIPS) group director Duncan Brock said: “Purchasing activity and new orders dropped like a stone in June as the UK construction sector experienced its worst month for a decade. A lack of clarity from policymakers has amplified the poor performance in June. Swift decision-making and a break in the political impasse hold the key to pulling the construction sector out of the quicksand.”

None of this is good news for those businesses who rely on a healthy construction industry to survive. The contraction across the sector means that careful planning and management of businesses is prudent until there is greater economic and political clarity and the work that has been on delay is hopefully given the go ahead.

Part of this planning should involve ensuring that your invoices are paid on time. Daniels Silverman can help to reduce the burden of getting your invoices paid by offering a white label credit control service that works alongside your business. Same day reporting means that you will always know where your accounts are up to and it frees up time for you to work on your business and planning for the future.

At Daniels Silverman we don’t charge a commission on every invoice collected, we charge a flat fee depending on the number of invoices you would like us to collect. This means you are in control of your budget and spending. We have years of experience, excellent collection rates and a friendly team who work hard to understand your business.
If you’d like to know more about how our services could help to support your business, please do get in touch. You can speak to one of our team via the website or give us a call to speak to somebody in person. We look forward to hearing from you.