PMI: UK construction industry experiences the steepest decline in activity in March 2020.

Britain’s construction industry experienced the sharpest decline in activity following last month’s financial crisis, a survey revealed on Monday, despite seeing far less pressure than other sectors that are affected due to coronavirus pandemic lockdown.

Also reported last week’s figures from financial data provider IHS Markit and the Chartered Institution of Procurement and Supply (CIPS), indicating the British business sector as a whole is shrinking at the highest pace in more than 20 years. 

The construction Purchasing Managers’ Index (PMI) plunged to 39.3 in March from 52.6 in February, its lowest since April 2009 and way below the average forecast of 44.0 by economists. The 13-point monthly decline has been the highest since the survey started in 1997, and the index is expected to worsen.

“The industry is trapped in quicksand and sinking more,” said CIPS group director Duncan Brock.

Britain’s government did not allow general construction activity to reduce the spread of coronavirus – unlike its order for most shops and restaurants to remain near to the public, and for workers in many industries to stay home if possible.

Nevertheless, IHS Markit said construction firms recorded stoppages last month when they sought guidance to keep staff 2 meters apart where they might be safe to do so, as well as a significant decrease in new orders.

“The survey respondents commented widely on concerns about the feasibility of proceeding with current projects as well as starting new work,” said Tim Moore, IHS Markit economist. “Meanwhile, construction supply chains are expected to concentrate primarily on providing vital activities such as infrastructure maintenance, safety-critical remedial work and public service support in the weeks ahead,” he said.

Last week, for the manufacturing and services industries, IHS Markit’s composite PMI fell to its lowest record at 36.0 in March, and Monday’s all-sector edition including the construction industry was also a record low at 36.3.