News - Construction News

Annual construction increase despite quarterly drop

Latest ONS figures reveal that annual construction output has  increased for the third consecutive year despite a quarterly drop.

The annual figures show a 2% increase in 2023 compared with 2022.

Quarterly construction output however, saw a decrease of 1.3% in from Oct to Dec 2023 compared with Quarter 3. The decrease was prompted by a 5% fall in new work, while repair and maintenance increased by 4.0%.

Over the month (December 2023) output is estimated to have decreased 0.5% in volume terms; this came solely from a decrease in new work (1.1% fall), as repair and maintenance increased 0.4% on the month.

At the sector level, three out of the nine sectors saw a fall in December 2023, with the main contributors to the monthly decrease seen in infrastructure new work, and private housing repair and maintenance, which decreased 6.4% and 1.1%, respectively.

Anecdotal evidence received from the Monthly Business Survey for Construction and Allied Trades (MBS) suggested a negative effect of seasonal weather decreasing output, with frost and snow during the first week of the month, and storms later in the month.

This is the third consecutive fall in monthly construction output, which resulted in a quarterly fall of 1.3%.

Total construction new orders decreased 13.1% (£1,361 million) in Quarter 4 2023 compared with Quarter 3 2023; this quarterly fall came mainly from the private commercial and industrial sectors, which decreased 18.1 % (£542 million) and 27.6% (£320 million), respectively.

The annual rate of construction output price growth was 3.1% in the 12 months to December 2023; this has slowed from the record annual price growth in May 2022 and June 2022 (10.7%).

Meanwhile annual construction output increased by 2.0% in 2023 compared with 2022; this is the third consecutive year of annual growth.

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