The subdued start to the year continued for the construction sector throughout February, as the industry struggled to regain the successful form amassed in the third and fourth quarter of 2015.
According to the latest Economic & Construction Market Review from industry analysts Barbour ABI, total construction contract value for February totalled £5.6 billion, a slight increase of 4.2 per cent on January’s figures but still way down on the £7.9 billion recorded in November, resulting in a 29 per cent decrease.
On a more positive note though, renewable energy continues to thrive. The sector shows no sign of slowing down after the recent subsidy cuts, with the £1.8 billion East Anglia One offshore wind farm being given the go-ahead – which is easily the biggest construction project awarded in February.
The value of this project is so great that it propelled the East of England to the top spot for the location of contract value in February, which is usually exclusively occupied by London.
Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said: “After another slow month in February, it’s clear that overall construction performance hinges heavily on the residential sector, in particular private housing.
"Even with residential increasing its total contract value compared to January, it is still well below the figures of the fourth quarter in 2015. However, steady improvement from the Infrastructure and Commercial & Retail sectors could significantly help remove the reliance the industry has on housebuilding contracts.
“Overall consensus is that construction activity remains on track to grow, with a solid pipeline building up over the spring and summer months. The industry is still growing at a steady enough pace, but as previously stated, more growth from the infrastructure and commercial & retail sectors would provide a substantial boost.”