Construction News

Mon June 14 2021

Related Information

Number of project starts continue to fall

1 May 13 Glenigan’s barometer of construction starts has shown another monthly drop in new building projects.

For the last three months – February, March and April – the Glenigan Index fell by 7% compared to 2012. Project starts have now fallen every month this year.

However, April saw a marked improvement in a number of sectors. Underlying starts in the civil engineering sector increased compared to last year; starts were up 9% in the infrastructure sector and 17% in the utilities sector compared to 2012. Education starts also also increased over the last month following with starts were up 15% compared to the same time last year.

“While the overall index declined in April there was a marked improvement in project starts for some sectors,” said Glenigan economist Andrew Whiffin. “Gains in infrastructure starts were driven by road and rail projects in London and the South East, and renewable energy projects pushed up starts in the utilities sector, with wind farms in Scotland and Wales providing the largest boost.

“The gains seen in some sectors this month are encouraging signs, especially in light of the poor project starts during the first quarter and official data showing industry output fell 6% compared to the first quarter of last year. However, it was still another disappointing month overall.”

Housing starts were weak once again this month, although the pace of decline in the private housing sector did slow. Starts were 7% down on a year ago. “The housing slowdown is likely in reaction to recent lending data that shows levels of mortgage approvals in the first quarter of the year are failing to surpass levels seen in 2012, despite new government support for home buyers,” said Whiffin.

Related Information

The industrial sector witnessed a dire performance in the first quarter of the year; underlying starts were 42% lower than the first quarter of 2012. April has however seen a turnaround in the sector’s fortunes with underlying starts 6% up on the three months to April last year. The start of a factory project related to production of wind turbine components helped boost starts for the sector in the North East.

Education starts have performed well since the start of the year and the sector has benefited from gains in refurbishment projects while new builds have remained firm. Further refurbishment work is due to come online later in the year as the first tranche of the priority schools building programme projects start on site.

Although there was a marked improvement during April, many parts of the UK are still seeing steep declines in the value of underlying project starts. Northern Ireland and Wales saw the steepest declines in underlying starts, both down by 30% in the three months to April. In Northern Ireland private housing starts have all but disappeared and weakness from publicly financed sectors also pushed starts lower. Wales performed very well last year and the decline in starts indicates this performance will not be repeated during 2013.

Yorkshire and the Humber was the best performing region, with underlying starts increasing by 15%. Private sector strength drove the gains with strong retail and industrial starts.

Got a story? Email


Click here to view more construction news »