The pace of U.K. construction sector expansion quickened in February on the back of commercial work though growth remained subdued overall, data from the IHS Markit/Chartered Institute of Procurement & Supply showed.
The Purchasing Managers' Index edged up to 51.4 in February from January's four-month low of 50.2, on a seasonally adjusted basis.
Commercial construction expanded at its fastest rate since May 2017, while the home-building category hit a soft patch.
"The construction sector endured another difficult month during February, with fragile business confidence, entrenched political uncertainty and softer housing market conditions all factors keeping growth in the slow lane," said Tim Moore, associate director at IHS Markit and author of the IHS Markit/CIPS construction PMI. Business confidence sank to one of its lowest levels during the past five years.
According to the survey, civil engineering was the construction sector's worst-performing category in February, marking its sharpest fall in five months. New work declined for the second consecutive month as survey respondents noted a small pool of work to replace projects headed for completion. Brexit-related uncertainty was also a factor, dragging the demand outlook and influencing decision-making.
"[C]ontinued job creation was the biggest surprise as survey respondents may be preparing for stronger than expected work flows," Duncan Brock, CIPS customer relationships director, said.
A relatively subdued demand for materials helped release some pressure on supply chains, but input cost inflation remained strong in February. Respondents cited higher fuel costs and wages as the main culprits for increased operating expenses.
"Despite pockets of resilience in the U.K. construction sector, there was little sign of an imminent turnaround in overall growth momentum," Moore added.
