LONDON, Oct. 3 (Xinhua) -- The British construction sector has moved into decline, according to figures released on Tuesday, with experts saying that fears of the negative effects of Brexit are hanging over the sector.
A big fall in new work led to the first decline for just over a year in the construction sector, with the Construction Purchasing Managers' Index (PMI) sinking to 48.1 in September from 51.1 in August (below 50 is decline).
Lower volumes of work revealed falls in commercial and civil engineering activity. The fall in civil engineering work was the steepest for nearly four-and-a-half years, which some firms linked to a lack of new infrastructure projects to replace completed contracts, according to index compiler Markit CIPS.
The latest decline in work on commercial development projects was the second-sharpest since February 2013, exceeded only by the post-EU referendum dip seen last July.
Survey respondents widely commented on a headwind from political and economic uncertainty, said Markit CIPS, alongside extended lead times for budget approvals among clients.
House building was the only broad area of construction activity to register an expansion. However, growth momentum eased to a six-month low amid reports citing worries about less favourable market conditions ahead. In addition new business volumes dropped for the third month running.
"The construction sector is entering its own recession, as Brexit risk dampens demand for commercial buildings and as housing demand cools," Samuel Tombs, chief UK economist at Pantheon Macroeconomics, a London-based financial data analysis firm, told Xinhua.
"Steeper declines in construction output likely lie ahead -- official data show that new orders fell by 7.8 percent quarter-on-quarter in Q2, the biggest drop for five years," said Tombs.
Markit also reported that business optimism fell to its second-lowest level since April 2013, Tombs added, suggesting that the UK government's shift to a more accommodating stance in Brexit talks has done little to convince builders that clients will sanction delayed projects soon.