THE DECLINE in construction activity in Ireland continued in February, although the rate of deterioration moderated on the previous month, according to latest figures from Ulster Bank.

Separately, figures from he Society of Chartered Surveyors (SCS) show that construction tender prices fell by 17.2 per cent over the past 12 months.

Tender prices fell by 7.5 per cent between July and December 2009. The end-of-year tender prices were 29 per cent below their peak in the first half of 2007.

Ulster Bank’s Construction Purchasing Managers’ Index rose to 40.4 in February from 36.1 in January. A figure below 50 indicates a decline in activity.

The bank said lower new business was the main factor driving the reduction in activity.

“This stands in contrast to the signs from the corresponding manufacturing and services sector surveys, which have been more encouraging lately, with improved global conditions and an associated rise in export orders bringing these two sectors close to expansion,” said Lynsey Clemenger, economist at Ulster Bank.

The fastest rate of decline of the three monitored sectors in February was recorded in the civil engineering category.

Housing activity fell at the weakest pace in nearly three years, while the slowest contraction was posted in the commercial category.

Commenting on the results of the chartered surveyors poll, Michael O’Connor, chair of the quality surveyors division of the SCS, said: “The continuous fall in tender prices and the extent of those falls year-on-year is forcing firms to take on jobs at below cost.

“This situation is not sustainable for any period and we are seeing that with the amount of firms going out of business and the catastrophic rise in unemployment throughout this sector,” said Mr O’Connor.