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Construction growth at lowest level since 2012

11 February 2019 | By Neil Gerrard

Image: Dreamstime / Bogdan Hoda

Output in the construction sector contracted by 0.3% in the final quarter of last year (October to December 2018), pulling annual growth in the industry down to its lowest level since 2012.

New figures from the Office for National Statistics showed that annual construction growth as of the end of last year was 0.6% - the lowest level in six years.

The 0.3% decline in output in the fourth quarter of 2018 was driven by repair and maintenance output, which was down by 2.8%, although this was offset by a 1.1% increase in all new work, driven by increases of 1.9% in infrastructure and 1.4% in private commercial new work.

The drop in output in the fourth quarter of 2018 followed a 2.1% increase in the third quarter.

Commenting on the figures, Mark Robinson, chief executive of Scape Group, said: “As a short month we often see a drop in construction output during the month of December, and December 2018 was no exception to that rule. A boom in November and a strong Q3 could have hoodwinked the industry into thinking it was business as usual, but a sharp decrease in all work highlights the need for the government and local authorities to provide greater transparency on project pipelines to ensure business optimism does not dip as we head into 2019."

Clive Docwra, managing director of construction consulting and design agency McBains, said: “Today’s figures show a mixed picture – unsurprising given concerns about the UK economy and whether it can withstand a no-deal Brexit.  These fears, coupled with longer running issues such as high import costs and skilled worker deficits, are now cutting through and impacting key investment decisions.

“To turn the corner, the industry needs confidence and the support of the government. The Brexit uncertainty will need clarifying soon if the sector is to push on and build the homes our country needs."

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