Monthly construction output increased by 1.1% in volume terms in January 2022 and is now at its highest level since September 2019, according to the latest ONS survey.
This follows an increase of 2.0% in December 2021 and is the third consecutive monthly growth greater than 1.0%.
The increase in monthly construction output in January 2022 came solely from an increase in repair and maintenance (4.6%) as new work saw a slight decrease of 0.8% on the month.
However, the Federation of Master Builders, warns that the recovery in construction output to its highest level since September 2019 risks being undermined by the invasion of Ukraine and the impact this is having on the supply of materials and rising costs.
Brian Berry, Chief Executive of the FMB, said: “Construction output is now at its highest level since September 2019, which is very positive news following an extremely difficult two years for builders.
“Interestingly, repair, maintenance and improvement projects were responsible for much of the increased output in January. The impact of the Russian invasion of Ukraine is likely to exacerbate the current challenges around the cost and procurement of building materials, with oil, steel, aluminium, timber, and copper set to be some of the worst affected materials.
“At a time when costs are surging, the situation puts builders in the unenviable position of having to raise costs for a customer base that is tightening its belts. To counter this, the FMB is advocating that the Government bring forward policy interventions at the upcoming Spring Statement that can ease the effects of this increase. In particular, there is a growing need for a National Retrofit Strategy and a cut in VAT on all energy efficient home improvements.
“These policies would provide an economic boost for local builders, reduce consumers’ vulnerability to energy shocks and further the UK on its journey to net zero.”
At the sector level, the ONS revealed that the main contributors to growth in January 2022 were private housing repair and maintenance and non-housing repair and maintenance, which grew by 5.0% and 5.5%, respectively.
The level of construction output in January 2022 was 1.4% (£197 million) above the February 2020 pre-coronavirus (COVID-19) pandemic level. New work was 2.8% (£267 million) below the February 2020 level, while repair and maintenance work was 9.3% (£464 million) above the February 2020 level.
The recovery to date (since the falls at the start of the coronavirus pandemic) is mixed at a sector level, with infrastructure 37.9% (£709 million) above and private commercial 27.8% (£693 million) below their respective February 2020 levels in January 2022.
Alongside the monthly increase, construction output rose 3.0% in the three months to January 2022; this is the strongest growth in the three-month on three-month series since June 2021 (3.4%), with increases seen in both new work and repair and maintenance (4.0% and 1.4%, respectively).
