British construction activity eased slightly in September from a near six-year high in August, a survey of purchasing managers showed today.
But residential construction in the UK rose at its fastest rate in nearly a decade.
The Markit/CIPS construction purchasing managers index (PMI) edged down to 58.9 from 59.1 but was still well above the 50 threshold that separates growth from contraction. Economists had expected a reading of 59.2.
All three sub-sectors of construction grew last month, with the sharpest rise in housing since November 2003, potentially easing some concerns about Britain's shortfall of new homes.
"Construction is no longer the weakest link in the UK economy," said Tim Moore, senior economist at Markit. "The third quarter of 2013 ended with output growth riding high amid greater spending on infrastructure projects and resurgent house building activity," he said.
Optimism was also up, with 51% expecting output wouldrise over the next 12 months and only 9% of respondents predicting a fall, the highest level of confidence since August 2010. Employers created jobs for the straight month in a row.
PMI data yesteday showed Britain's manufacturing activity grew at a slower rate than expected in September, but also showed that employment picking up.
The Bank of England is keeping a close eye on the UK labour market, having said that it would not consider raising record-low interest rates until the jobless rate falls to 7%.
On Friday, mortgage lender Nationwide said British house prices rose for the fifth month in a row in September and hit record highs in London.