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22/05/2015

Building output falls – report

Words: Laura Edgar

Construction output in the UK fell in April in comparison with March, with the value of contracts awarded totalling £5.5 billion, according to new figures.

Although output was found to be 11 per cent higher in April 2015 when compared with April 2014, activity was down 9.8 per cent on March 2015. Overall, the construction sector was found to have declined in the UK by 1.1 per cent between Q4 2014 and Q1 2015.

The report (pdf) - produced by Barbour ABI, which supplies construction data to the Office for National Statistics, Cabinet Office and Treasury - also showed that commercial and retail “caused the greatest drag on growth”, with the value of construction down from March to £731 million for April, a decrease of 12.9 per cent.

“Construction is currently 7.5 per cent below its pre-recession peak” - report

On the other hand, Barbour ABI said private housing accounted for 67 per cent of the value of contracts awarded in April, which has been attributed to large projects including the £69 million development of Wandsworth Riverside Quarter.

Michael Dall, lead economist at Barbour ABI, said the decline in April could be put down to ‘pre-election uncertainty and financial year end’.

“Despite this apparent cloud over construction, demand within housing coupled with scheduled works across the public sector suggest that there are in fact many sunny days on the horizon.

“Improved confidence and accurate forecast spend as a result of the newly formed government and pending July Budget should help reinvigorate the construction sector for a stronger performance later in the year, provided these pending peaks are sufficiently prepared for and harnessed,” he explained.

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