Positive signs for UK construction

The second quarter of the year showed generally positive improvements for the UK construction industry, according to separate data from the UK Office for National Statistics (ONS) and the Construction Products Association.

The ONS said construction output in the three months to the end of June was 1.4% higher compared to the first quarter, but 0.5% lower year-on-year. On an annual basis, increases of 9.8% and 8.2% in public and private new housing were offset by large falls in other public new work and private-commercial new work, which reported decreases of 12.3% and 8.2% respectively.

Steve McGuckin, UK managing director of consultancy Turner & Townsend, said, “The construction industry isn't out of the tunnel yet, but at least we can see the light.”

Meanwhile, the Construction Products Association’s latest Construction Trade Survey showed that conditions in the second quarter improved across all construction sectors in the UK, and throughout the supply chain. Even small and medium-sized businesses – hardest hit by the downturn – reported their first rise in activity since 2007.

The Association said private housing was one of the key contributors to the improving workloads, together with a catch-up across many sectors following a poor first quarter, when adverse weather significantly affected output.

Key survey findings included the fact that 72% of contractors reported a rise in building work year-on-year, while 42% of contractors working on private housing developments and 40% of contractors working on public housing developments also reported annual rises.

Construction Products Association economics director Noble Francis said the Association expected construction output to rise 2.2% in 2014 and a further 4.5% in 2015, driven by both private housing and infrastructure.

“To ensure growth in infrastructure, it is essential that all the announcements we have heard over the past three years actually turn into activity on the ground,” Mr Francis said.