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April ONS: Output shrinks again

12 Jun Construction output in Great Britain declined in April for the third successive month, according to latest official statistics.

Monthly construction output in Great Britain is estimated to have decreased by 1.4% in volume terms in April 2024, the Office of National Statistics said.

This follows a 0.4% fall in March and a 1.9% fall in February.

As in previous months, anecdotal evidence suggests that wet weather stifled construction activity.

April’s fall in monthly output came from decreases in both new work (1.9% fall), and repair and maintenance (0.8% fall).

The value of construction output in April 2024 was put at £14,940m by ONS.

The main contributors to the monthly decrease were private housing new work and private housing repair & maintenance, which fell by 4.4% and 2.5% respectively.

Construction output is estimated to have decreased by 2.2% in the three months to April 2024, with new work down 2.8% and repair & maintenance down 1.4%.

This is the sixth consecutive fall in the three-monthly series.

Clive Docwra, managing director of property and construction consultancy McBains, said: “After last month’s figures showed the construction sector still mired in technical recession, today’s figures come as a further blow for the industry.

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“A close to 2% fall in new work across the board highlights the continuing caution shown by investors being reluctant to commit to new projects while so many economic uncertainties remain. New work in private housing in particular remains in the doldrums, seeing a fall of more than four percent.

“Many in the industry are crossing their fingers for a post-election boost, but today’s figures show that whichever party forms the next government has a job on its hands to restore confidence and encourage growth.”

Michael Wynne, director of the house-builder Q New Homes, commented: “Construction output is still shrinking, and the industry once again has the unwanted distinction of being the weakest sector in a weak economy.

“Today’s data is disappointing on virtually every level. The contraction isn’t just confined to certain subsectors of the construction industry either, with seven out of nine heading in the wrong direction.

“And while April’s poor weather – which delayed work on many building sites – might explain the sharp drop in that one month, April was no anomaly. The less volatile quarterly measure of output also shows a 2.2% contraction – the sixth time in a row it has been stuck in reverse.

“Yet for all the bleakness, there are glimmers of optimism. Materials cost inflation – which wiped out many smaller builders’ profit margins during the dark days of 2023 – continues to soften.

“While interest rates remain painfully high, there is widespread hope that the Bank of England will finally start to reduce the Base Rate once the election is out of the way – which will make it easier for developers to purchase land and build new homes, and make those homes more affordable for buyers.

“With both the Conservatives and Labour promising to support house-builders and make it easier for first-time buyers to own their own home, the prospect of a more builder-friendly government is tantalising and overdue.

“Whoever wins, a rationalisation of Britain’s dysfunctional planning system is urgently required as it is needlessly holding back residential construction and pushing the housing crisis from bad to worse.”

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