Costs rise as pace of construction activity surges to highest level in seven months
The pace of construction activity in Ireland has surged to its highest level in seven months, according to data released by Ulster Bank today.
The acceleration of construction output has seen demand for workers rise, with a third of Irish building firms reporting an increase in employment. The rate of hiring hit an eight-month high last month.
But the strong activity reported by the sector is also starting to push up costs.
Robust demand has prompted suppliers to increase their charges, and also resulted in delivery delays, according to Ulster Bank. It added that the rise in input costs faced by construction firms in October was the fastest since August 2015.
Despite the spectre of Brexit, Irish construction firms were more confident in October of the future than they were in September.
The Ulster Bank Construction Purchasing Managers' Index - which tracks changes in construction activity - hit 62.3 in October, up from 58.7 in September.
Any figure above 50 on the index indicates expansion in the sector, while any figure below 50 indicates contraction.
Simon Barry, the chief economist for the Republic of Ireland at Ulster Bank, said the October figures "paint an encouraging picture" of the construction sector.
About two-thirds of firms surveyed expect to be even busier over the next 12 months.
"Firms continue to report a strengthening in client demand amid a general improvement in economic conditions as an important contributor to the ongoing uplift in new business volumes," he said.
"In turn, the healthy expansion of new orders continues to underpin increased demand for construction workers."