Construction sector shows modest growth in March as small-scale projects lead the way
- CNL Reporter
- May 2, 2025
- Constructions
- Construction sector
- 0 Comments
Sri Lanka’s construction sector showed signs of continued expansion in March, with the Purchasing Managers’ Index (PMI) for Construction reaching 54.3.
While this marks a slight dip from February’s 55.6, it indicates the industry is still on an upward trajectory, remaining above the neutral 50.0 threshold for the third consecutive month.
The modest expansion is largely attributed to a stable environment (steady input prices and favourable weather conditions), that has allowed construction work to continue.
Survey respondents highlighted that while the sector is in growth mode, the majority of available projects remain small-scale developments.
Growth in the New Orders index in the March report released by the Central Bank indicates that demand for construction services is present, even if much of it is coming from smaller-scale ventures.
In line with this, the Quantity of Purchases index also saw an increase. However, not all areas of the sector are seeing growth. The Employment Index continued its contraction, although at a slower rate compared to the previous month. This suggests that while some construction firms are managing to maintain staffing levels, the industry is still not fully absorbing the workforce it needs.
Another challenge is the Suppliers’ Delivery Time index, which remains stretched in March. Longer delivery times for materials and supplies continue to be a bottleneck, limiting the ability of firms to scale up operations more efficiently.
The report highlighted that the outlook for the next three months is positive, with expectations for more projects in the pipeline.
