The UK construction industry continues to slip as the looming Brexit vote draws nearer. The 25th of June will be the deciding day to whether or not Britain stay with the European Union or opts out. Since the vote was announced, engineers have been keeping their eyes on the Markit/CIPS construction purchasing managers’ index (PMI). The theory is that due to the looming vote no one will be investing in the construction industry, and those critics would be right.
The PMI data made available indicates that the manufacturing sector did see some improvement, however, the construction industry is at a three-year-low. The numbers in the index went down from 52 in April, to 51.2 in May. June could be seeing a further slip in numbers due to the vote. A senior economist at Markit, Tim Moore, told The Telegraph: “My data signalled the worst month for commercial building since June 2013, while residential work and civil engineering activity both saw a renewed loss of momentum. Survey respondents noted that the forthcoming EU referendum has disrupted new order flows and the timing of client decision making in particular.”
The neighbours across the pond are also interested in what is going to happen on the 25th. Donald Trump said that he would be visiting the UK the day the referendum happens. Trump has invested in the civil engineering endeavours in the UK, notably buying the Turnberry Hotel that has just been opened to guests. Trump says that Britain should leave the EU, which he confirmed in an interview with Fox, where he said: “I know Great Britain very well. I know the country very well. I have a lot of investments there. I would say that they’re better off without it [the EU]. But I want them to make their own decision.” He also said that the UK would not be in the back of the line for trade deals if he were president. President Obama notoriously said that Britain would be at the back of the line in trade deals if they opted to leave the European Union.
The Guardian caught up with the chief UK and European from IHS Global Insight, Howard Archer. He said: “The government will be particularly disappointed to see housebuilding growth could only edge up for the third month running in May and is around its lowest levels since early 2013, given that it is looking to address the UK’s accurate housing shortage.”
Other analysts are saying even if Britain remains in the EU, the damage has been done and the slow-down will continue. “The official data clearly shows that public sector construction is squeezed, while the revival in housebuilding has run into skilled labour shortages,” said Samuel Tombs, chief UK economist at Pantehon Macroeconomics.