Unreconstructed figures for the building sector

Activity in the construction sector was down 10.1% in the year to July, making disappointing reading for the optimists.

by Michael Northcott
Last Updated: 19 Aug 2013

It had looked as though the UK was teetering on the edge of economic recovery, with three months of falling unemployment figures, and the double-dip recession suddenly not looking as bad when the ONS tweaked its figures. But the construction sector has been one of the worst casualties of the country’s economic plight, and now it has contracted a massive 10.1%. Even if you consider just the three months of May to July instead of the full year, activity was still down 10% on the same period the previous year.  

There is some solace to be taken in the fact that figures have been skewed by Diamond Jubilee bank holidays, but this means that May’s activity was higher than usual because of a bank holiday being moved to June. Importantly, the ONS pointed our that the volume of construction output actually increased 2.2% between June and July this year, after the normal working calendar had got back on track. So swings and roundabouts, then. 

Notably, the biggest drops in construction output were public sector work. The ONS recorded a 23.9% drop in new infrastructure working, a 22.4% drop in new public housing construction, and a 21.5% drop in other public construction work. It said that areas of positive growth were in infrastructure maintenance and repair, private industrial workl and private non-housing repair and maintenance. But none of these increased by more than 3.5% - hardly enough to offset such large drops in public sector work.

Still, we can hold on to hope with the knowledge that normal working patterns restored the wider sector averages to a positive growth figure. Perhaps the Diamond Jubilee bank holidays were just a one-off spanner in the works, so to speak…

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