Construction output rises in Great Britain

Output in the construction industry in Great Britain increased 0.2% in October, compared with September, according to the latest figures by the Office for National Statistics (ONS).

All new work increased 1.2%, while repair and maintenance decreased 1.5%.

Within all new work, private commercial rose 4.1%, and private new housing rose 2.3%. Meanwhile, there were decreases in public new housing of 2.8%, private industrial of 1.6%, public other new work of 1.2%, and infrastructure reported decreases of 1.1%. Within the repair and maintenance category, there were falls in all work types, with housing repair and maintenance decreasing by 2.4%, and non-housing repair and maintenance decreasing by 0.6%.

Compared with October 2014, output in the construction industry increased 1%. All new work increased 4.2%, while there was a fall of 4.2% in repair and maintenance.

New orders for the construction industry in the third quarter of 2015 were estimated to have increased 0.8% compared with the second quarter and showed no growth compared with the third quarter of 2014. Public other new work rose 10.8%, private commercial rose 4.1%, and all other work rose 2.7% during the third quarter.

Dr Noble Francis, economics director of the Construction Products Association (CPA), said, “After the slowdown in construction activity in the third quarter, it was good to see an acceleration in activity for the construction industry on both a monthly and an annual basis.

“However, the figures also highlight contrasting fortunes for private and public house building. Private housing output rose 2.3% in October compared with September and was 4.6% higher than a year ago.”

He added, “Going forward, policies announced by the Chancellor in his recent Autumn Statement, such as London Help to Buy, should ensure further growth in private housing output by incentivising major house builders to increase building rates over the next 12 months.

“However, there are mounting concerns regarding affordability in the housing market, especially in London where average house prices are already 9.6 times average earnings.”

Meanwhile, Andrew Bridges, managing director of Stirling Ackroyd estate agents in London, said, “Construction is the cure for Britain’s housing heartache. Small steps forward for housebuilding are a shuffle in the right direction – but hardly enough to move the earth beneath our feet.

“In London, planning is postponing people’s lives. Our research shows applications for new homes are over four times more likely to be rejected in Outer London boroughs. Greater London as a whole is not even giving legal permission for three quarters of the necessary homes, let alone building them in time. This is entirely unsustainable. The construction industry needs more work, Londoners need more options – and London needs permission to prosper as a world city economy.”