The building industry’s revival continued in August, which marked its 12 straight months of growth since it began emerging from recession last year, according to figures out today.

The Ulster Bank Construction Purchasing Managers' Index (PMI), which tracks the sector's performance on a monthly basis, hit 61.4 in August, indicating that the industry grew strongly during the month.

Strong growth in new orders and good activity in both housing and commercial construction were behind the growth in August, the report states.

The figure was below the 62.6 recorded in July, but any reading over the benchmark of 50 indicates expansion on the previous month. Any result below that figure means that the sector contracted.

Simon Barry, chief economist Republic of Ireland at Ulster Bank, said: "The solid improvement continues to be underpinned by particular strength in both the housing and commercial arenas where activity trends are benefiting from substantial increases in new orders," he said. "In turn, the solid trends in new business are translating into higher staffing levels, with the employment index recording its 12th consecutive month of expansion."

Mr Barry added that the headline index itself has been growing for 12 straight months as the industry pulled away from the deep trough it hit during the six-year recession that began in 2007 with the implosion of the Republic’s property and construction markets.

During that time the value of the industry’s output collapsed by €30 billion a year to €8 billion while employment fell from more than 350,000 to less than 100,000.

“Moreover, construction companies are confident that the sector’s recovery will remain on track in the coming year,” Mr Barry said.

“Sentiment rose for the third month in a row in August, taking it to a near-record high as respondents anticipate that further improvements in both the construction sector itself and the broader economy will result in further activity gains in the coming 12 months.”

The PMI shows that housing recorded the strongest growth, at 65.4, up from 63.7 in July, while commercial activity hit 64.6 in August, compared with 63.2 the previous month.

In contrast, civil engineering, which includes big-ticket State-funded projects such as road building, actually declined, dropping to 49.3.

The fall was not as sharp as it was in July, when it dipped to 48.3.

New orders rose sharply. According to Ulster Bank, this has increased in each of the last 14 months “with the rate of expansion remaining substantial”.