Labour’s plans to ‘build, baby, build’ have suffered a setback after the construction sector shrank for a ninth month in a row because of uncertainty over the Budget.
The closely-watched purchasing managers’ index (PMI) for the sector gave a reading of 46.2 for September – up from 45.5 in August but still below the 50-mark separating growth from contraction.
It also revealed that construction cut employment levels for the ninth month in a row – the longest run since the pandemic.
The figures highlight the challenge facing Housing Secretary Steve Reed as he vows to ‘build, baby, build’ to meet Labour’s goal of building 1.5m homes in this Parliament.
They showed firms were being held back by fears of a tax raid by Chancellor Rachel Reeves next month.
Tim Moore, economics director at S&P Global Market Intelligence, which compiled the report, said firms across the sector ‘faced pressure on multiple fronts’ and sentiment remained subdued with companies ‘yet to see a turning point on the horizon’.
Slump: The purchasing managers’ index for construction gave a reading of 46.2 for September – up from 45.5 in August but still below the 50-mark separating growth from contraction
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