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The UK construction sector contracted for the seventh month running in November as new work fell sharply amid yet more political uncertainty, survey data has shown.

The poor performance of the sector led firms to lay off workers for the eighth month in a row, in the latest sign that Britain’s jobs boom is slowing.

The IHS Markit/Cips UK construction purchasing managers’ index came in at 45.3 in November, compared to 44.2 in October. A figure below 50 indicates contraction.

Economists had predicted a score of 44.5, meaning November’s figure beat expectations and was the slowest drop in overall construction for four months.

Nonetheless, the UK’s building sector showed no signs of escaping its recent recession ahead of the 12 December General Election.

Both Labour and the Conservatives have promised to ramp up spending on infrastructure should they win power, which could boost the construction sector.

Duncan Brock, group director at Cips – the Chartered Institute of Procurement & Supply – said: “Brexit uncertainty, an impending General Election and wet weather all combined to keep the construction sector firmly in its contraction hole last month.”

All three main areas of construction contracted in November. Civil engineering was the worst-performing category, followed by commercial building. There was a much slower decline in housing activity.

On top of the political uncertainty that has dragged on UK economic growth in 2019, respondents reported that a lack of new work to replace old contracts and the unusually wet weather weighed on the sector in November.

Tim Moore, economics associate director at data firm IHS Markit, said: “The forthcoming General Election continued to send a chill breeze across the sector.”

He added: “House-building has been the most resilient category of construction output in 2019. However, it remains a concern that overall volumes of residential building work have dropped in each month since June.”

By Harry Robertson

Source: City AM

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