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Monthly UK Construction Output Up 1.1% - Including 2.6% Growth In Private Housing

13th March 2024


The rise in monthly construction output comes after three consecutive monthly falls, with the value sitting at £15,422m in January 2024.

Construction output is estimated to have decreased by 0.9% in the three months to January 2024 in the latest ONS figures; this came solely from a decrease in new work (4.5% fall), as repair and maintenance increased by 4.0%.

The decrease over the three months came from infrastructure new work and private housing new work, which fell 9.3% and 5.2%, respectively. The main positive contributions came from non-housing repair and maintenance and private housing repair and maintenance, which increased 3.2% and 3.3%, respectively.

The increase in monthly output came from increases in both new work (1.1%) and repair and maintenance (1.2%).

At the sector level, six out of the nine sectors saw a rise in January 2024; the main contributors to the monthly increase were private new housing and non-housing repair and maintenance, which increased by 2.6% and 1.9%, respectively.

Industry voices were cautiously optimistic at the news of rising construction output

Clive Docwra, managing director of property and construction consultancy McBains, said: “After three consecutive months of falling output, the industry will welcome January’s return to growth.

“The 2.6% increase in private housing is particularly encouraging given the performance of this sector over the last few months. The hope is that if mortgage rates ease, it could lead to increased residential demand which in turn could trigger a bigger turnaround in housebuilding numbers.

“But whether the increase in January turns out to represent the green shoots of wider recovery or a blip remains to be seen. Growth over the longer term is estimated to have decreased 0.9% in the three months to January 2024, highlighting that conditions remain unsettled for many industry sectors.”

Agility and looking ahead will be key to success

Neeral Shah, CEO and founder of YardLink: “As the latest ONS stats reveal a 1.1% increase in construction output for January 2024, it’s clear that the sector is experiencing growth momentum.

“With pent-up supply, contractors can now strategically position themselves to be competitive whilst also improving margins. By leveraging innovative technologies for planning and procurement, and streamlining processes, contractors can not only meet the rising demand but also enhance productivity and drive sustainable growth.

“As we navigate this dynamic landscape, it’s imperative for industry stakeholders to be adaptive and agile to seize the opportunities that lie ahead.”

Fraser Johns, finance director at Beard, said: “The sector as a whole has certainly started the year with greater confidence and a real sense of optimism, with an increase in new work in January contributing to a rise in construction output. It certainly mirrors what we’re seeing on the ground at Beard throughout the first quarter of the year, with our secured orders at a record high.

“A key factor is shifting sentiment around the future prospects of the market and the economy, with an improved outlook for both giving clients the necessary confidence to commit to new projects. Given the consistent trend of repair and maintenance, we are continuing to see clients taking stock of the assets they have and making any necessary improvements ahead of pure replacement.

“Even as conditions improve and the tide begins to turn, there’s no question pressures still remain. As a result, we continue to stay close to clients and work collaboratively with them and with our supply chain to generate value and navigate the challenges they may face in getting to site. No matter the economic outlook or the prospects of the sector, this should be standard practice for all contractors, nurturing those close relationships and all-important confidence among clients.”

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