Germany’s construction industry recorded a decrease in activity for the first time in nine months in July as commercial and civil engineering activity contracted, a closely-watched report showed on Tuesday.

The headline seasonally adjusted IHS Markit Germany Construction Purchasing Managers’ Index (PMI) — a measure of month-on-month changes in total industry activity — fell to 49.5 in July from 50.0 in June, a survey report compiled by IHS Market showed.

The drop in July reflected contractions in both commercial and civil engineering activity. New orders at constructors remained on a downward trajectory, meanwhile, falling at the quickest pace since September 2014.

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With confidence toward future output also declining, constructors recorded one of the smallest increases in employment over the past three years. For the first time in nine months, the number of firms expecting output to fall over the next 12 months exceeded those forecasting a rise, the report added.

“As is the case with manufacturing, there is an increasing drag on overall economic output from the construction sector in July,” Phil Smith, principal economist at IHS Markit, said in the report. “A fall in new orders of the magnitude seen in July would suggest that the slowdown is no longer just about capacity constraints, although this is clearly still an important factor.”

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