Construction output slows

As April showers continued into May, the latest statistics from the ONS show that construction output in the UK fell by 0.8%, although output still remains above that of pre-pandemic February 2020 levels.

However, even with the most recent monthly drop taken into account, construction output grew by 6.3% within the three months to May 2021 compared to the previous three-month period. Increases in new work (6.6%) and repair and maintenance (5.8%) led the way.

Growth in all sectors

Growth across all sectors has led to this increase in new work, with the largest contributors to this growth being private housing new work and infrastructure, which grew by 7.4% and 9.7% respectively.

Looking at the monthly figures, the decline in growth between April and May was contributed to by drops in the new work and repair and maintenance sectors, which were both impacted by the adverse weather conditions of these months. New work fell by 0.4% and repair and maintenance fell by 1.5% respectively.

The overall increase in repair and maintenance, 5.8%, in the three months to May 2021 was due to growth in non-housing and private housing repair and maintenance, which grew by 9.0% and 4.7% respectively. This reflects homeowners’ desire to create better spaces and home offices after working from home became the norm for many.

Opportunities strong in the public sector

Despite this latest single-month blip, overall construction has clearly continued its bounceback from the pandemic and is set to thrive over the second half of the year. With government commitment to infrastructure, health estates and education estates, the industry remains mostly confident as local authority spending, central government spending and tender opportunities all continue to rise. However, areas of concern do remain, particularly over supply chains, building materials shortages and shortages of skilled workers.

Brian Berry, Chief Executive of the FMB, noted: “Action must be taken to address the national building materials shortage, as this is restricting builders’ ability to build back better and greener. A recent FMB survey found that 93% of builders reported material price increases in Q1 2021, which is an untenable situation. Manufacturers, merchants and builders must work together to maintain the supply of products to independent merchants so that smaller builders can continue to improve, upgrade and green the nation’s homes.”

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