12.06.202308:09:00UTC+00Irish Construction Downturn Softens In May

Ireland's construction sector deteriorated at a slower rate in May and moved towards stabilization as new orders, employment, and purchasing all increased at quicker rates, survey results from S&P Global showed Monday.

The headline BNP Paribas Real Estate Ireland Construction Purchasing Managers' Index rose to 49.4 in May from 48.4 in April. Nonetheless, any score below 50 indicates contraction in the sector.

Among sectors, commercial activity showed sustained and strong growth in May. Meanwhile, the decline in housing activity eased from April but remained solid overall.

Total new orders received by Irish construction firms grew for the fourth successive month, though only marginally.

In line with rising new orders, firms raised their staffing numbers and purchasing activity in May, with the latter logging its fourth straight increase.

Although supply chain pressures eased in May, vendors faced labor shortage issues. Average lead times lengthened, but at the least pronounced rate since November 2017.

On the price front, input prices rose markedly in May, though the rate of inflation eased to the weakest since August 2020 as sub-contractor charges moderated to a 26-month low.

Looking ahead, Irish constructors were positive about expected activity over the coming 12 months amid hopes for a sustained pick-up in market demand, a boost in development activity, higher volumes of renewable energy projects, and a payoff from new business strategies.