German Construction Decline Continues in May with PMI at 48.1
Activity in Germany’s construction sector contracted further and deeper in May according to Markit Economics’ survey, with PMI falling to 48.1 in May from 49.7 in April.
The score is Germany’s lowest since March 2013.
New orders for the construction sector fell for the 26th month in May, although the rate eased since April. As a result, contractors reduced their purchasing activity last month.
Civil engineering activity declined at the fastest pace for a year last month, while residential building’s decline also picked up pace Residential construction activity fell at a faster pace in May, while commercial construction activity rose for the thirteenth consecutive month and at a faster pace than in April.
Despite the declines in new orders and activity, construction employment rose for the 14th consecutive month in May. Some survey respondents attributed the higher staffing levels to the processing of backlogs.
Input costs continued to increase during May, with a fifth of survey participants signalling higher cost burdens. However, the rate of cost inflation eased slightly since the previous month and was the weakest since the beginning of the year.
Vendor performance continued to deteriorate in May and supplier’s delivery times lengthened to the weakest degree in more than a year.
German constructors were pessimistic regarding the outlook for the sector’s activity for the year ahead, ending a four-month sequence of positive sentiment. The survey results put lower demand as one of the major reasons for these negative expectations.
Commenting on the Markit Germany Construction PMI survey data, Oliver Kolodseike, Economist at Markit said: “The downturn in Germany’s construction sector accelerated in May, with the headline PMI falling to a 14-month low.
“The combination of declining construction activity, falling inflows of new orders and negative expectations with regards to the one-year outlook gives a cocktail with a risk for headache, especially if the sector remains in contraction territory in the coming months.
“The only positives from this month's data are the resilience of the labour market to weakening demand and a slight rise in commercial activity."
Environment Agency clamps down on plastic films and wraps
Businesses in the waste and construction industries must ensure they deal with waste plastic properly to stop illegal exports, the Environment Agency (EA) has warned.
The warning comes as the Agency is increasingly aware of plastic film and wrap from the construction and demolition sector being illegally exported.
Exports are frequently being classified as ‘green list’ waste of low risk to the environment, but are often contaminated with materials such as mud, sand, bricks and wood, posing a risk to the environment and human health overseas, and undermining legitimate businesses in the UK seeking to recover such waste properly.
During the last year, the EA has intercepted shipments to prevent the illegal export of this material on numerous occasions. The Agency inspected 1,889 containers at English ports and stopped 463 being illegally exported. This, combined with regulatory intervention upstream at sites, prevented the illegal export of nearly 23,000 tonnes of waste.
Those convicted of illegally exporting waste face an unlimited fine and a two-year jail sentence. But construction firms could also face enforcement action if contaminated construction and demolition waste plastic is illegally exported.
Malcolm Lythgo, Head of Waste Regulation at the Environment Agency, said it is seeing a marked increase in the number of highly contaminated plastic film and wrap shipments from the construction and demolition industry being stopped by officers.
“I would strongly urge businesses to observe their legal responsibility to ensure waste is processed appropriately, so we can protect human health and the environment now and for future generations. It’s not enough just to give your waste to someone else - even a registered carrier. You need to know where your waste will ultimately end up to know it’s been handled properly. We want to work constructively with those in the construction and waste sectors so they can operate compliantly, but we will not hesitate to clamp down on those who show disregard for the environment and the law.”
There are a number of simple, practical steps that businesses can take to ensure that C&D site waste is handled legally.
Construction businesses should check what’s in their waste
- Different waste types need different treatments and so must be correctly categorised to ensure it goes to a site that is authorised to handle it safely. Businesses can also check if their waste is hazardous as different rules might apply.
- If you are removing the waste yourself, you must be a registered waste carrier- registration can be carried out here. When a waste collector is transporting your site waste, you must check they have a waste carrier’s licence from the EA.
- You must also check that the end destination site any waste is taken to is permitted to accept it and has the right authorisations in place. Keep a record of any waste that leaves your site by completing a waste transfer note or a consignment note for hazardous waste which record what and how much waste you have handed over and where it is going.
Waste management industry must adhere to export controls
- Contaminated C&D waste plastic - including low-density polyethylene (LDPE) wrap and film - must be exported with prior consent from the EA as well as competent authorities in transit and destination countries.
- Those involved in the export of such waste must ensure that it meets the requirements set under the relevant export controls, such as being almost free-from contamination; the destination sites are appropriately licensed to receive and treat the waste; and waste is correctly managed once received.
The EA will continue to actively target those who export contaminated C&D plastic waste illegally, including any accredited packaging exporters who issue Packaging Waste Export Recovery Notes (PERNs) against such material in breach of their Conditions of Accreditation.
Businesses involved in the shipment of waste are required to take all necessary steps to ensure the waste they ship is managed in an environmentally sound manner throughout its shipment and during its recycling.
Anyone with information regarding the illegal export of waste including C&D waste plastics can contact the EA’s Illegal Waste Exports team at: [email protected] or anonymously via Crimestoppers on 0800 555 111 or via their website