The 0.4% fall in construction output in April is bad news for the whole construction sector, but is especially concerning for small builders given repair, maintenance and improvement work (RMI) fell by 2.4%, says the Federation of Master Builders (FMB) in response to recently released ONS Construction Output data.
The monthly decrease is the first monthly decline seen since October 2021.
The ONS reports the decrease came from a fall in repair and maintenance (2.4%), which was offset slightly by a rise in new work (0.9%); the fall is partly a by-product of the growth (3.0%) in March 2022, because of the demand caused by the repair work resulting from storms in February 2022.
At the sector level, the main contributors to the decline in April 2022 were private housing repair and maintenance, and private commercial new work, which decreased by 6.5% and 3.8%, respectively.
Brian Berry, Chief Executive of the FMB, said: “Signs of stagnation in construction output should concern policymakers at a time when the smallest firms in the sector are already struggling to stay afloat.
“The cost-of-living crisis hitting consumers, coupled with persistent difficulties in affording pricey building materials and recruiting skilled tradespeople, mean that the months ahead will become increasingly difficult to navigate for these local construction firms.
“At a time when these local building firms should be recovering from the pandemic, they are instead entering another period where survival will be their primary aim.
“It’s imperative that the Government works to ease the pressures, whether via a VAT cut on all home improvements to support the struggling repair, maintenance, and improvement sector, or via the upcoming planning reforms to reverse the decades of decline experienced by small housing developers.”
Despite the monthly fall, the level of construction output in April 2022 was 3.3% (£481 million) above the February 2020 pre-coronavirus (COVID-19) level; new work was 0.7% (£68 million) below, while repair and maintenance work was 11.0% (£549 million) above.
The recovery to date, since the falls at the start of the coronavirus pandemic, is mixed at a sector level, with infrastructure 35.6% (£669 million) above and private commercial 27.2% (£676 million) below their respective February 2020 levels in April 2022.
Despite the monthly decrease, construction output increased 2.9% in the three months to April 2022; this is the sixth consecutive growth in the three-month on three-month series, with increases seen in both new work and repair and maintenance (2.2% and 4.0%, respectively).
