The latest results of the Ulster Bank Construction PMI survey point to a drop in Irish construction activity of historic proportions last month. The headline PMI index fell from 28.9 in March to an unprecedentedly-low level of just 4.5 in April, easily surpassing the previous all-time record low of 25.7 reached at the height of the global financial crisis.
The vast majority of survey respondents (nearly 93%) reported a reduction in business activity from March, reflecting widespread site closures in response to the Covid-19-related public health restrictive measures. Moreover, the detailed results reveal the breadth of the decline, with around 95% of respondents reporting a fall in commercial activity, while 93% of respondents reported a drop in housing activity.
The forward-looking elements of the PMI survey also pointed to extreme and widespread weakness in April. Notably, 83.5% of firms reported declines in incoming new business flows, with the collapse in actual and prospective activity in turn weighing on staffing levels last month. Indeed, the Employment PMI plunged to a new all-time low in April as 56% of respondents reported lower workforce levels last month.
However, there are also glimmers of hope for the Irish construction sector. Confidence about the coming year rose slightly in April, an outcome which has likely been reinforced by the post -survey government announcement that a phased return to work for outdoor workers, including those in construction, will be allowed from the 18th of May which may mean that April proves to be the nadir of the current crisis for Irish construction firms.