UK construction contracts for third month running

Sector posts continued decline.

The UK construction PMI, released today, indicates moderate contraction in that sector for the third month in a row. The rate of contraction (represented by an index of 48.7, where 50 means no change) was unchanged from December.

 

Commenting on the report, David Noble, CEO of the Chartered Institute of Purchasing & Supply which co-publishes the report with Markit economics, said:

Snow compounded difficult economic conditions to ensure the construction sector’s winter blues continued into January. Yet against expectations, businesses have a spring in their step looking ahead to 2013. This new-found confidence has been buoyed by news of public investment, but it could be found wanting, if the Government’s recent rhetoric on major infrastructure projects fails to bear fruit.

The construction sector is a relatively small section of the UK's overall output, but a key enabler of growth in other sectors. Its continued depression will likely have second-order effects, acting as a dampener on the rate of expansion in the more economically crucial sectors like services and manufacturing.

Additionally, the report highlights the continued contraction in housing construction as one of the drivers of the sector's weakness. With housebuilding a perennial political issue, the news indicates that measures to prop it up are yet to have the desired impact — although, with the rate of contraction slowing somewhat, the news is not as dire as it could have been.

Construction, as she is played. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Italian PM Matteo Renzi resigns after referendum No vote

Europe's right-wing populists cheered the result. 

Italy's centrist Prime Minister Matteo Renzi was forced to resign late on Sunday after he lost a referendum on constitutional change.

With most ballots counted, 60 per cent of Italians voted No to change, according to the BBC. The turn out was nearly 70 per cent. 

Voters were asked whether they backed a reform to Italy's complex political system, but right-wing populists have interpreted the referendum as a wider poll on the direction of the country.

Before the result, former Ukip leader Nigel Farage tweeted: "Hope the exit polls in Italy are right. This vote looks to me to be more about the Euro than constitutional change."

The leader of France's far-right Front National, Marine Le Pen, tweeted "bravo" to her Eurosceptic "friend" Matteo Salvini, a politician who campaigned for the No vote. She described the referendum result as a "thirst for liberty". 

In his resignation speech, Renzi told reporters he took responsibility for the outcome and added "good luck to us all". 

Since gaining office in 2014, Renzi has been a reformist politician. He introduced same-sex civil unions, made employment laws more flexible and abolished small taxes, and was known by some as "Europe's last Blairite".

However, his proposed constitutional reforms divided opinion even among liberals, because of the way they removed certain checks and balances and handed increased power to the government.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.