Construction Output Falls in February

According to new data from the Office for National Statistics, construction output in the UK fell by 0.2% in the three months to February 2020.

This was also driven by a 1.7% fall in repair and maintenance but also partially offset by a 0.6% growth in new work.  The rise in new work in the three months leading to February 2020 was driven by some growth in infrastructure, along with public other new work which also grew by 2.8% and 4.5% respectively, with no other new work sectors seeing any growth.

When looking at repair and maintenance, there was a fall of 5.6% in private housing repair and maintenance, which is its highest reduction since October 2012 when it fell by 5.7%. In contrast to this, public housing and non-housing repair and maintenance increased by 2.1% and 0.1% respectively.

Commenting on the ONS stats, Brian Berry, Chief Executive for the Federation of Master Builders (FMB), said: “Repair and maintenance plummeted during a wet winter, and builders have not had the opportunity to revive workloads due to the coronavirus lockdown. They have been suffering due to conditions outside their control, and further Government help is needed to get this important sector through the crisis.”

Mr Berry added: “The Government must ramp up its support for builders by allowing Directors of small Limited companies use their dividend payments in their Job Retention Scheme claims. A cash grant mechanism to get builders through this tough time should also be developed, and all financial schemes must come online as soon as possible.”

The fall in construction output was driven by a 3.4% fall in new work, which more than offset the 1.7% growth in repair and maintenance. New work is likely to have been impacted by the adverse weather conditions which the UK experience throughout February 2020.

Moreover, construction output decreased by 1.7% in February 2020 to £13.522 million, which is the largest fall in monthly growth since October 2019’s 2.4% fall. In the longer term, the ONS has seen a subdued growth in output over the last 12 months.

Looking at the 3.4% fall in new work in February 2020, the ONS states that this is due to a decrease in all new work sectors with the exception of public other new work, which grew by 1.8%, which equates to a £15 million increase. The largest negative contribution comes from private new housing, which fell by 7.7% (£236 million). This is the largest fall in the private new housing series since January 2018.

In addition to this, the COVID-19 (Coronavirus) seems to have had a limited impact on the data collected for February 2020.

Clive Docwra, Managing Director of construction consulting and design agency McBains said of the new figures: “These figures are a worrying sign of sluggishness in the construction sector, which was already evident before the coronavirus outbreak.

“Output decreased by 1.7% in February – the largest fall in monthly growth since October 2019. In particular, the drop in private new housing, which fell 7.7% on the previous month, is a cause for concern as it is the second largest fall since monthly records began.”

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