ONS construction output figures: industry reaction

Reaction from people within the construction industry about the 3.9% increase.

Following last week’s Office for National Statistics (ONS) figures showing a 3.9% rise in construction output in March, UK Construction Media has seen how the industry is reacting to these statistics. 

Compared to March 2014, output grew in March 2015 by 1.6%, with repair and maintenance performing well and private new housing growing by 11.1%. 

After five straight months of contraction, new work increased in March too. 

Although March recorded a rise in output, the quarter from January to March showed that output is down by 1.1% when compared with Q4 2014. 

Mainly due to a decrease in new work as well as repair and maintenance, the Q1 output is down by 0.3% from the same time in 2014. 

UK Construction Media has been given reaction to these figures, including from Philip Prince, Director of Constructionline. He attributed the quarterly drop to the General Election uncertainty, and is positive about the rest of the year. 

He said: “It is encouraging to see output rise in March, but the decline in activity over the last quarter, after a sluggish end to 2014, will make for sobering reading for many across the industry. 

“The General Election will no doubt have had an impact on a traditionally dynamic industry that is sensitive to changes in Government and reflects what we saw in 2010. That said, output did bounce back and we expect it to do so again, possibly at a faster rate.

“Our own growth figures show a 0.3% increase in the Constructionline service’s use over the three months, which highlights that we may see more positive output figures over the remainder of the year with clients now starting to build their supply chains for future projects.”

There is a belief that in order for output to continue to grow in the future, skills need to be brought in line. Clive Ormerod, Managing Director of OMS – a training and consultancy specialist for the construction sector – believes training is crucial in making sure the industry isn’t “severely hampered.” 

“These figures are welcome, of course, but continuing growth in the sector will be severely hampered by a massive under investment in training during the lean years,” he said. 

“The industry is waking up to the scale of the skills crisis. For example, it is good to see many of our construction sector clients embracing apprenticeships. But much more needs to be done, from upskilling the next generation of managers to avoiding potentially catastrophic mistakes caused by failing to invest adequately in compliance training.”

The importance of addressing the skills shortage was echoed by Peter Vinden, Managing Director of The Vinden Partnership, who said that housing should now get moving again.

He said: “With housing forming a key pillar of the Election debates, we should now expect to see long-standing promises put into action. This seems likely, with proposed brownfield developments and housing projects on the agenda for this year, as well as the promotion of devolved powers for regional cities. 

“The latter would see increased investment and control over urban planning and housing projects for Manchester an any cities wishing to follow its lead, which will hopefully lead to a boost in activity for the areas requiring it. 

“That said, what we should be focusing on as an industry is the persistent problem of a skills shortage. If we are going to realistically address lagging output figures, the Government investment pledges need to be supported with educational resources for employers and apprentices. 

“That way, we can help more young people into better job roles nationwide, and can ensure we have the talent necessary to make the vision for Britain a reality.”

Finally, Mark Morley, OpenText’s Director of Manufacturing, explained the impact of construction output increases from a manufacturing perspective. 

He said: “A combination of increased domestic sales and lower utilities prices are contributing to the success of the UK manufacturing industry. 

“This is allowing UK manufacturers to boost workforce numbers, invest in restructuring supply chains and develop digital strategies by moving legacy ICT infrastructures to modern cloud-based environments. 

“In the long term, measures that encourage manufacturers to adopt a digital business strategy, will allow companies to remain competitive on a global stage – and more importantly – will contribute to even further growth of the UK manufacturing industry.”

The post ONS construction output figures: industry reaction appeared first on UK Construction Online.