|Hopes for a rebound in UK construction output were given a boost on Thursday, as a closely-watched economic indicator showed that the sector almost returned to growth in April.
The Markit/CIPS Construction Purchasing Managers' Index (PMI) rose to 49.4 in April from 47.2 in March, slightly below the 50 level that divides growth from contraction but well above economists' expectations for a reading of 48.
It was also was the best performance in six months for a sector that has been the biggest drag on UK growth.
Tim Moore, senior economist at Markit, said the sector bounced back following a disruption to work caused by the cold weather earlier in the year, and was mainly led by higher levels of residential housebuilding.
"“UK construction sector output was closer to stabilisation than at any time since October 2012," said Mr Moore. "The overall survey findings are an early indication that construction will act as less of a drag on UK GDP over the second quarter of 2013."
Markit said that employment levels "were broadly stable" at the start of the second quarter, with subdued demand patterns leading to cautious job hiring trends. However, a rise in business optimism about the year-ahead outlook had helped stabilise overall staffing levels, Markit said.
Thursday's data will add to hopes that a recovery in the construction industry, which accounts for about 7pc of UK gross domestic product, is finally gaining traction after years of decline. Data last week from the Office for National Statistics showed that the constuction output fell by 2.5pc in the first three months of the year, dragging down UK gross domestic product by 0.17 percentage points.
However, economists warned that the sector still faced significant challenges. Howard Archer, senior economist at IHS Global Insight, said: "The sector undeniably still faces significant headwinds, notably including limited public investment and spending, a still weak economy, comparatively limited housing market activity, and problems in getting funding for large-scale projects.
"The construction sector will be fervently hoping that both the economy and the housing market see sustained improvement over the coming months, even if only limited, and that this stimulates building work."
Thursday's construction PMI followed a stronger than expected manufacturing PMI that showed Britain's factories almost stabilised in April after months of contraction.
Britain's services sector is expected to maintain its steady expansion at 52.4 when PMI data for April are released on Friday. Official UK growth figures last week showed that the economy grew by 0.3pc in the first three months of the year, after a strong services sector, which powers more than three quarters of the British economy, helped the UK to avoid its third recession in four years.