After being battered by Brexit uncertainty and extreme weather in the third quarter of the year, the construction industry fought back in November, posting its biggest monthly growth in output since January 2019.
Monthly construction output increased by 1.9% in November 2019, partially recovering from the 2.2% fall in October 2019. The 1.9% increase in November 2019 is the largest monthly growth since January 2019, when it grew 2.4%.
Andy Sommerville, Director at Search Acumen, said: “The new-found clarity over the political situation has started to provide some necessary reassurance but we also need decisive action to ensure we take a step in the right direction.
“The UK construction industry stands on a threshold – advancing forwards to achieve new heights or slipping backwards to stagnation. Growth has been slow, but the UK construction market still stands tall in Europe. While the volume of construction orders has advanced only incrementally in the past year, the value of orders is at an all-time high and so is the number of construction firms in operation.”
New work began to trickle in, with a 2.4% growth. However, private housing was the only sector within new work to see a fall in construction output in the three months to November 2019, compared with the previous three months, decreasing by 0.4% (£34 million).
However, on a monthly basis, private new housing was leader of the back, rising 4.6% (£135 million). Similar to all work and new work, the increase in month-on-month growth for private new housing in November 2019 follows a fall of 4.9% (£150 million) in October 2019.
Over the longer term, since the start of 2017, the industry has experienced a slight upward trend in growth in the all work series. However, this is markedly slower growth than the period prior to 2017.
Month on year, public new housing continues its recent strong performance, growing by 20.1% (£98 million). Despite it having a relatively small size in comparison to other sectors, this continues to be one of the largest contributors.
Neil Knight, business development director, Spicerhaart Part-Exchange & Assisted Move, said: “The figures released before Christmas suggested that construction was flattening off in the private sector. While the latest data are an improvement on last month, overall volumes are similar to the same time last year.
“As a result of last month’s general election, there is now much greater political certainty. We’re already seeing a strong start to the year, and we’d expect to see confidence returning to the market throughout 2020. That will take a while to feed through into more positive output figures though, so we wouldn’t expect to see an immediate improvement.
“It’s not just about confidence: now that we have a government with a stable majority, it would be good to see some evidence of a long-term strategy to tackle some of the problems in the housing sector. The Budget in March will be an opportunity for the Government to show that it gets this.”
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