Construction rebounds with 2.4% output increase

Construction rebounds with 2.4% output increase

Output in the UK construction sector rebounded in February 2023 thanks to a 2.4% increase in volume terms, according to new estimates from the Office for National Statistics (ONS).

The increase came from upward movements in both repair and maintenance (4.5%) and new work (1.1%) on the month and follows a 1.7% fall in January 2023.

February 2023 is now the highest monthly value in level terms (£15,558 million) since records began in January 2010.

Anecdotal evidence suggested several reasons for the increase in February 2023; it was partially driven by a bounce back from the fall in January 2023, but also continued strength across repair and maintenance sectors; many firms also noted an improvement of weather in February, which allowed them to get more work done.

At the sector level, eight out of the nine sectors saw a rise in February 2023, with the main contributors to the monthly increase seen in private housing repair and maintenance, and non-housing repair and maintenance, which increased 5.0% and 3.7%, respectively.

Alongside the monthly increase, construction output saw an increase of 0.9% in the three months to February 2023; this is the sixth period of consecutive growth in the three-month-on-three-month series; the increase came solely from a rise in repair and maintenance (3.1%), as new work saw a decrease (0.5% fall).

The main positive contributors to the increase in the three months to February 2023 were non-housing repair and maintenance (5.5%) and infrastructure new work (2.8%); with the main negative contributor being private new housing (4.4% fall), despite the increase on the month; anecdotal evidence suggested a general slowdown in housing across recent months.

Clive Docwra, managing director of property and construction consultancy McBains, said: “As January saw the weakest monthly growth since June 2022, the construction industry will welcome today’s figures, with the proviso that much of the increase in output during February reflects a bounce back from the disappointing previous month.

“The increase was also driven by repair and maintenance work rather than new orders, confirming that caution is still the watchword amongst many investors who are holding back on new projects. There remains a mixed picture across work sectors - for example, new commercial housing projects saw a 4.4% fall, continuing the trend of not enough housing being built.

“Looking further ahead, the outlook for March may be less optimistic, given that it was the wettest for 40 years which will mean site work will have been impacted.

“Skills shortages are also still biting, and while the recent announcement by the government that bricklayers, roofers, carpenters and plasterers will be added to the Shortage Occupation List from this summer means the skills gap will be partially plugged, we would have liked to see additional professions such as electricians also added to the list.”

Share icon
Share this article: