UK construction output fell 1.1% in the three month to September

UK construction output fell by 1.1% in the three month to September compared to the previous quarter, according to the Office for National Statistics (ONS).

The construction sector performed slightly better than what the ONS had indicated last month when it published its first estimate of GDP figures – it initially estimated a 1.4% fall in construction activity.

The main reason for the construction industry contraction in the third quarter was the steep decline in repair and maintenance, which fell by 3.6% – this was offset slightly by all new work which increased by 0.3%.

There was no growth in new housing for the quarter, however, infrastructure increased by 1.2% – the first quarter-on-quarter increase in over a year.

All work increased by 0.1% in Q3 2016 compared to Q3 2015, representing the fourteenth consecutive period of quarterly year-on-year growth – all new work rose 2.0% while repair and maintenance fell by 3.4%.

All work, Quarter 3 (July to Sept) 2016:

figure-1-all-work-quarter-3-july-to-sept-2016
Source: ONS –“Construction output in Great Britain: Sept 2016 and July to Sept 2016”

Construction output grew 0.3% in September compared with August

In September 2016, construction output increased by 0.3% compared with the previous month. All new work increased by 1.2% while there was a fall in repair and maintenance of 1.4%. On the year, output rose by 0.2% in September 2016 compared with September 2015.

ONS statistician Kate Davies said. “Construction output has remained broadly flat in the last year, both before and after the recent referendum.”



The data suggests that the UK economy has been more resilient than expected. The FT reports that surveys of purchasing managers and shoekeepers reveal that “demand in the economy has not slowed significantly.”

Chris Williamson, from IHS Markit, told the BBC that there’s “light appearing for beleaguered builders.”

“First, the downturn had been signalled in advance by survey data which have since revived. The Markit/CIPS PMI survey has shown construction industry output rising in both September and October, with the rate of growth accelerating to the highest since March,” Williamson said.

“Second, the official data lag behind the survey but likewise recorded an upturn in the month of September, with output up 0.3% compared to August,” he added.

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