LONDON, Dec 5 Reuters Activity in Britain39;s construction industry picked up in November but growth was lopsided, according to an industry survey that showed weaker residential housebuilding which is sensitive to high interest rates.

The SP GlobalCIPS UK Purchasing Managers39; Index for the construction industry came in at 55.2 last month, up from October39;s 54.3.

Robust demand for commercial and civil engineering projects offset the contraction in residential housebuilding, Wednesday39;s survey showed.

The Bank of England is expected to keep interest rates on hold this month after reducing them in November for only the second time since 2020. BoE Governor Andrew Bailey on Wednesday reiterated that future rate cuts were likely to be gradual.

Commercial construction activity expanded at the fastest pace since May 2022. By contrast, residential work declined at the steepest rate since June. Housebuilding firms said high borrowing costs and fragile consumer confidence were impacting demand.

Tim Moore, economics director at SP Global Market Intelligence, said while the construction industry has avoided the slowdown seen elsewhere in the UK economy, the still high cost of borrowing hit new orders.

Construction firms also grew less optimistic about their prospects in the upcoming 12 months, with confidence at its lowest since October 2023.

A loss of momentum for new work, alongside concerns about rising employment costs, resulted in weaker job creation and falling…