Construction Industry Output Drops 7%

Written By Unknown on Jumat, 12 April 2013 | 18.56

The total volume of UK construction output in February was 7% lower than in the same month last year, according to official figures.

Although output showed a significant contraction to a year earlier, output was 5.5% higher than in January, according to non-seasonally adjusted data that provides a glimmer of hope that activity in the sector may be recovering.

The Office for National Statistics (ONS) said nearly all sectors recorded increases during the month with the exception of 'private commercial other new work' which showed a fall of 0.5%.

Despite making up less than 7% of the economy,weak construction output was the main drag on growth during the first half of last year, helping push Britain into recession.

Surveys have pointed to weakness in the sector.

The Markit/CIPS construction index shows the sector contracted for a third consecutive month in March.

Construction output is highly responsive to the economic cycle and has fallen by 16.5% when comparing the last quarter of 2012 with the first quarter of 2008, the ONS said.

Comparing the three months from December 2012 to February 2013 with the same three months one year earlier, the volume of construction output decreased by 8.9%.

New work was lower by 10.7%, with large falls in public other new work and private-commercial other new work, which reported decreases of 23.7% and 9.8% respectively.

Other new work excludes the housing and infrastructure sectors but includes construction such as factories, warehouses, schools and offices.

There was also a 5.6% decrease in repair and maintenance, mainly due to a 8.3% fall in the repair and maintenance of housing.

Chancellor George Osborne used his Budget speech last month to push for greater residential construction as a way of sparking growth in the construction industry.


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