Following on from trade surveys and the BEIS construction materials price index that have highlighted rising raw materials costs across the construction supply chain, the February purchasing managers index from IHS Markit/CIPS showed construction firms experienced the fastest rise in cost burdens for more than 12 years. Global demand patterns echo those of the pent-up demand and catch-up we are seeing in UK construction since activity restarted in May last year, with spiking demand for timber and steel in particular from across Europe, the US and Asia. In addition, inflationary pressures have been exacerbated by the related impact on shipping and freight costs, container availability and packaging materials. For UK construction, this combines with the longer-running pressures on labour costs at a time when margins have already been compressed by Covid-related expenses.
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Matt McKeown, Senior Communications Executive