03 November 2006 | Rebecca Ellinor

Growth in the UK construction industry was last month was the strongest since March 2004.

The seasonally adjusted CIPS purchasing managers' index (PMI) - in which a reading above 50 indicates growth - recorded total construction activity at 58.1 in October, a leap from September's figure of 53.6.

Expansion was widespread throughout the sector and purchasing managers reported a sharp rise in employment as a result. The employment index was 55.9 in October, as against 55.2 for September.

The growth was hindered by capacity constraints, with a further deterioration in the quality of sub-contractor work noted as well as lengthening of supplier delivery times.

The suppliers' delivery times index recorded a reading of 45.9. Delays were blamed on increased purchasing activity and shortages of some construction materials.

The rate of growth of new business was the strongest since November 2005, with the new orders index standing at 57.3 for October.

Coverage of previous PMI reports is available at www.supplymanagement.com/pmi

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