CONSTRUCTION remained weak

CONSTRUCTION remained weak in November, with new orders registering a further decline and activity falling across all the major sectors, a survey shows.

The Australian Industry Group Housing Industry Association Performance of Construction Index (PCI) fell 1.8 points to 42.2 in November. Readings below 50 indicate contraction in activity.

The PCI survey found that activity was weaker across the board with all the major sectors spending the month in negative territory. The rate of decline accelerated in all sectors except for engineering.

Australian Industry Group Director of Public Policy, Peter Burn said private investment in the sector was failing to offset the withdrawal of government stimulus.

"The continuing weakness in the construction industry reinforces other reports about the patchiness of economic activity in the face of higher interest rates and the withdrawal of government stimulus measures.

"Weakness continues across the construction sector but is particularly evident in the residential housing and apartment sub-sectors. "Expectations of further interest rate rises are having a significant impact on the sector," Dr Burns said.

House building declined for the sixth consecutive month, falling 9.9 points to 38.0.

Housing Industry Association chief economist, Harley Dale, said the new home building sector was enduring renewed weakness.

"The accelerated decline in new orders for both detached houses and apartment building in November is very concerning," he said.

The PCI survey showed the activity sub-index fell 4.0 points to 38.2.

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