The reading just reaffirms that construction activity remains subdued at the end of last year, despite a pickup in employment conditions. New order
The reading just reaffirms that construction activity remains subdued at the end of last year, despite a pickup in employment conditions. New orders saw a contraction once again, though the rate of decline is slightly less compared to November. The details continue to highlight that supply constraints and cost pressures are weighing on the sector. Markit notes that:
“The construction sector ended 2021 with another
subdued performance on the activity front. The headline
PMI remained in sub-50 contraction territory, though it
did tick up slightly to its highest since February 2020,
which was a positive of sorts.
“The employment data were once again the main bright
spot, showing job creation in the construction sector
not only continuing but also gathering pace as further
efforts were made to increase capacity.
“Cost pressures faced by German building companies
remained strong in December, but even on this front
there were some reasons for encouragement as the rate
of input price inflation dropped to a nine-month low
amid signs of supply bottlenecks slowly easing.
“Although expectations improved slightly since
November, constructors ultimately remained downbeat
about growth prospects in 2022, with price pressures still
uncomfortably high and a lack of tender opportunities
weighing on confidence.”
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