UK construction set for growth says association

The UK’s Construction Products Association said it expected sectors of the industry to grow by as much as 18% in 2014, according to its spring forecast.

The association said the construction industry’s recovery was becoming stronger and broader, and it pointed to increases in private house building, together with growth in the infrastructure and commercial sectors.

The spring forecast said private housing starts would rise 18% in 2014 and 10% in 2015; commercial office construction would increase 7% in 2014 and 10% in 2015; and infrastructure activity would grow 10.1% in 2014 and 7.2% in 2015.

Dr Noble Francis, economics director, said, “One year since the construction recovery began, activity is becoming firmly entrenched. We forecast 4.5% growth in 2014 and a further rise of 4.8% in 2015.

"The construction industry is now on track to grow 18% by 2017 and contribute an additional £20 billion (€24 billion) to the UK economy.”

The Construction Products Association stressed that private house building only accounted for 15% of total construction. It said commercial, the largest sector, was expected to grow each year up to 2017. The offices sub-sector, in particular, has recently shown growth, though demand was mostly in Central London.

The association said it also expected last year’s gains in the infrastructure sector to continue to 2017, when levels are forecast to be 42% higher than in 2012.

“Recently, rail has been the fastest growing infrastructure sub-sector and the near-term growth in activity will be led by Crossrail and the Thameslink Programme. Another strong sub-sector is roads, which fell almost 50% in only two years but is forecast to grow every year to 2017, including 15% in 2014,” said Dr Francis.

The retail sub-sector output growth was also expected to show 4% growth in 2014 and 8% in 2015.

Dr Francis added, “The main risks to our forecasts arise around the issue of energy. Construction and manufacturing firms have serious concerns regarding energy security and supply.

"Constant delays to the nuclear programme and uncertainty regarding investment in gas-fired power stations only exacerbate these concerns."

He went on, "As a consequence, we continue to highlight the need for government to deliver on its numerous announcements of project investments and ensure these feed through into activity on the ground.”