UK output fall confirmed by results

A fall in growth in UK construction sector output has been confirmed by latest Office for National Statistics (ONS) figures.

The study showed that November had seen a 2% decline against October, with new orders decreasing by 0.4% and repair and maintenance down 6%. They were said to have been the main factor behind the results.

Figures for September to November 2014 showed construction output reduced 0.9% compared with the previous three months between June and August.

The ONS data mirrored results from the Markit UK purchase managers’ index findings, which showed growth in the UK’s construction sector had fallen to its slowest pace for 17 months. However, there were encouraging signs from the homebuilding and commercial development sectors.

Chris Temple, engineering and construction leader at PwC (PricewaterhouseCoopers), explained that despite the fall in results, clients were “highly-optimistic” of growth in their business during 2015.

He highlighted the fact that overall, output figures were 3% higher than at November 2013, with encouraging signs from the homebuilding market.

Temple said, “The fall in output for November continues the recent trend of the construction sector catching its breath. There is a lack of large infrastructure projects at the moment, accounting for the lull in that part of the sector. Furthermore, the economy, particularly in Europe, is showing some signs of weakness, which has knock-on effects for business confidence and the short-term order books of construction firms.

“New housing was up more than a fifth on a year ago, showing that house building is a key growth area. House builders have a healthy pipeline and are building at healthy rates, and we expect this to continue throughout 2015.”