Construction activity holds up despite poor June weather

9 August 2019 | By Neil Gerrard

Construction output fell by 1.3% in the second quarter of 2019 after a bout of poor weather in June, but the volume of activity was nonetheless higher than a year ago.

That’s according to new official figures from the Office for National Statistics, which today revealed a 0.2% drop in gross domestic product (GDP) from April to June.

The Q2 decline in construciton output reversed the 1.4% growth recorded in the first quarter of the year.

On a quarterly basis, output fell in all sectors except commercial, public housing and public housing repair, maintenance and improvement. On an annual basis, Q2 output was 1.4% higher, led by housing and infrastructure.

Rebecca Larkin, senior economist at the Construction Products Association, said: “The sharpest decline in construction activity was the 0.7% monthly fall in June, as a result of unseasonably bad weather delaying work on-site, particularly in the RM&I sectors, which account for around one-third of overall output. However, even though construction lost £521 million in output compared to Q1, the volume of activity was still higher than a year ago. This was driven by clear pockets of activity in house building by housing associations and local authorities, with public housing output reaching a record high level in Q2, and although output fell in quarterly terms for private housing and infrastructure, output from these sectors remains at a historically high level.

“The performance of other sectors such as commercial offices and retail, industrial factories is less convincing against the backdrop of Brexit uncertainty that complicates decision-making on investments with a high up-front outlay.”    

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