Construction industry starts fall

Published:  02 February, 2016

New site starts in the construction industry fell 20% in the three-month period to the end of January, compared to the same period in 2014/15, according to the latest figures released on 1 February by Glenigan.

The value of new work starting on site (excluding projects above £100m) fell in every sector including residential, non-residential and civil engineering. Office construction was the only sector of the industry to edge higher during this period.

The decline has been partly blamed on heavy rainfall and waterlogged sites. Allan Wilén, Glenigan's economics director, said: "The atrocious weather has clearly halted project starts. This has exacerbated an already evident softening in workloads, with new construction activity now in the worst period of decline since crashing in 2009."

Glenigan's monthly barometer of project starts has been in negative territory for eight out of the last 10 months. However, the latest figures give the strongest evidence yet that construction's prospects have weakened markedly since this stage a year ago.

Mr Wilén added: "The official output figures show R&M spending by both government and private institutions was already slowing in the second half of last year. Glenigan's data on project starts suggests that newbuild activity will also be constrained in the coming months."

The dire weather impacted construction sites across the UK; only Wales saw starts hold above the level of a year earlier. Over the 12-month period to the end of January, work is down across the UK as a whole, but the Midlands and Northern English regions are outperforming.

Yorkshire and the Humber, the North East and West and the East and West Midlands are all in the black. By contrast, starts have contracted in the Capital and most of Southern England. Wales, Scotland and Northern Ireland's construction industries have all sunk lower over the last 12 months.

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