Construction
activity in the UK beat all expectations in August as infrastructure and
housebuilding surged, but overall the sector remains on a downward trend.
According
to the latest figures from the Office for National Statistics (ONS), output rose 3.5 per cent
in August against the same period a year earlier, well beyond consensus
predictions for a rise of 0.2 per cent.
Month-on-month, construction output
rose by 0.6 per cent on July, led by a 3.6 per cent rise in infrastructure and
a 2.3 per cent increase in private housing.
But looking at the
figures on a rolling three-month basis – which smooths out the more volatile
monthly figures – output fell by 0.8 per cent. The figures were dragged down by
declines in repair and maintenance.
It was the fourth
consecutive month where construction fell on a three-month basis.
The ONS said despite
the recent declines, construction output remains at a relatively high level,
though its has dropped below its peak reached in January of this year. In that
month, output was 29 per cent higher than the lowest point of the previous five
years. Output now stands at 27.3 per cent above that low point.
Michael Thirkettle, Chief Executive
of leading construction consulting and design agency McBains, said: “These figures indicate that the
construction industry is treading water with the UK withdrawal from the EU on
the horizon.
“With a lack of clarity from the government on the
Brexit deal, many UK companies and investors are biding their time on
committing to new projects, which means confidence remains fragile. Cost
pressures are impacting too, with rising prices for imported materials because
of the weak pound.
"Although today’s figures show growth in private
housing, a long-term commitment from government to give an additional boost to
the UK housebuilding sector would have been a welcome tonic, yet Theresa May's
announcement that just an additional 25,000 homes for social rent would be
built received an underwhelming response from the industry.”
