Irish construction ended 2016 on a high

Current trends suggest that 2017 will be another strong year...

Irish construction ended 2016 on a high

William Murphy, Flickr

Activity in Ireland's construction sector continued to grow in December according to the Ulster Bank Construction Purchasing Managers’ Index - it stood at a healthy 59.8.

This is well above the 50 threshold, which indicates that the sector is growing. The reading was down marginally on the 59.8 recorded in November.

New orders have risen continuously throughout the past three-and-a-half years, December's expansion was faster than the level recorded in November.

The industry's level of job creation has also expanded as new orders came in - it was in-line with a spike recorded in November.

The rate of input cost inflation accelerated sharply during December and was the fastest since March 2007.

Commenting on the survey, Simon Barry, Chief Economist Republic of Ireland at Ulster Bank said : "Overall, the December survey results round off another strong year of recovery for Irish construction firms, with the PMI consistently pointing to ongoing healthy expansion throughout 2016.  Moreover, momentum behind the sector’s recovery continues to look encouragingly solid, with a marked pick up in New Orders in December indicating that activity trends look set to remain positive in early 2017.

"Furthermore, firms themselves remain strongly optimistic about the coming year with almost two thirds of respondents expecting further growth in activity in the coming 12 months.  While a notable late-year pick up in input prices points to increased challenges on the costs front, positive sentiment about the year ahead is being underpinned by signs of improving conditions in both the construction sector itself and the wider Irish economy."