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Construction growth slows in May

PMI drops from 55.8 to 54.4, but remains in growth.

The May construction PMI for the UK came in at 54.4, down from 55.8 in April. This represents a slowing of growth in the sector, although it remains one of the highest-performing areas of the UK economy. A figure of above 50 in the PMI represents growth, according to a survey of purchasing managers in construction.

Tim Moore, Senior Economist at Markit, said:

A softer trend in new projects set the tone for the construction sector in May, with output growth hitting a three-month low and business confidence dropping sharply since April.

While still in positive territory, the month-on-month fall in business confidence was the greatest since June 2010, which was when plans for the autumn government spending review were first announced. This reassessment of the year-ahead outlook represents worries within the construction sector that weakening economic conditions could leave firms running on empty again once existing projects have come to completion.

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