Brexit uncertainty fails to dampen construction output

Calls against complacency have been sounded regarding the potential impact of a ‘no deal’ Brexit after the UK construction sector recorded an all-time high in rise in output.

Construction output figures published today by the Office for National Statistics (ONS) show that UK output grew by 2.1% during September to November 2018 compared with the previous three months.

Brexit uncertainty fails to dampen construction output

The increase was driven by all new work, which increased by 3.4%, but was offset slightly by a decline in all repair and maintenance, which fell by 0.4%.

The increase in the all new work three-month on three-month series was driven primarily by private new housing and infrastructure which increased by 4.9% and 6.5% respectively.

Construction output recorded an all-time level high in November 2018 in the chained volume measure seasonally adjusted series; the month-on-month series grew by 0.6%, resulting in the total value of construction output exceeding £14 billion for the first time since monthly records began in 2010.

This was driven primarily by strong growth in private new housing, private commercial new work, and public housing repair and maintenance, which increased by 3.1%, 2.3%, and 5.8% respectively.

Sarah McMonagle, director of external affairs at the Federation of Master Builders (FMB), said: “The UK construction sector grew by 2.1 per cent during September to November 2018 compared with the previous three months. This is despite unparalleled levels of political uncertainty around the very real prospect of a ‘no deal’ scenario. However, we are urging the government not to allow these results to create a false sense of security. Since November, political uncertainty has cranked up and is increasing every day. A growing and prosperous construction sector will be a distant memory if the Government allows the UK to crash out of the EU without a deal in place.”

McMonagle added: “The construction industry is also extremely concerned about the government’s proposed post-Brexit immigration system. In the Immigration White Paper, published at the end of last year, the government revealed that they will make few allowances for low skilled workers to enter the UK post-Brexit.

“Most tradespeople will be defined as low skilled and therefore will not be permitted to enter the UK, regardless of whether they are from the EU or further afield. It is crucial that the government introduces a post-Brexit immigration system that continues to allow us to draw on essential migrant workers or else their house building and infrastructure targets will be totally unachievable.”

Brexit uncertainty fails to dampen construction output

Andy Mallice

Andy Mallice, managing director of Hart Builders, part of the Cruden Group, said: “It’s encouraging to see a rise in output activity in the sector.  Certainly at Cruden we are seeing continued confidence in the housing market and have already secured a strong order book for 2019.

“Undoubtedly the impact that Brexit could have on the construction industry will be at the forefront of thoughts across the industry this year, so it’s encouraging news that the Scottish Government have set up a Holyrood committee specifically to examine the impact of Brexit on Scottish construction, together with considering how we can encourage young people to work in the industry.  

“Construction lies at the heart of the Scottish economy and key to its sustained growth will be investment in future talent. Within the Cruden Group, we continue to play our part through our continuous programme of investment in our employees’ lifelong learning and training, coupled with and our successful modern apprenticeship programme. This ensures that we have a solid pipeline of skilled employees to help us face any challenges and be well placed to take advantage of opportunities in the future.” 

Share icon
Share this article: