Kerry London News

Construction grows for the seventh month in a row

Thursday 4th August
Construction grows for the seventh month in a row

The construction industry achieved record growth of 1.5 per cent during May due to a surge in new commercial work.

Data published by the Office for National Statistics (ONS) shows that growth in the construction industry increased from £100.8m in April to £102.3m in May. Despite a prolonged spell of challenging economic conditions, the industry has continued to grow for seven consecutive months. The ONS revised its April figures to a 0.3 per cent increase after initially recording a decline.

New commercial work single-handedly bolstered the sector during May, climbing 2.8 per cent. New private commercial work and private housing generated increases of 12.1 per cent and 7.2 per cent, respectively. After many months of growth, repair and maintenance work experienced a 0.4 per cent drop.

Improvements in pre-pandemic levels continue. 

ONS figures show an improvement of 4.1 per cent in construction output, or £598m, compared to pre-COVID levels (February 2020). Repair and maintenance work also fared better, growing by £601m. Interestingly, despite having a positive growth spell during May, new work is still slightly below the February 2020 level, down £3m. Encouragingly, the ONS observed that order books “continued to remain strong” despite the ongoing, long-term challenges of spiralling product prices and VAT tax increases for red diesel.

Neon Mavromatis, Managing Director, Construction, commented on the new figures, “This is impressive from an industry that has continued to grow in the face of tough inflationary pressures such rising materials costs and fuel price increases.”

The current uncertainty across markets may stall investment in specific sectors. However, the Government has sought to address this by appointing Lord Callanan as Construction Minister on 12 July 2022. Callanan has worked on retrofitting the social housing sector to achieve net zero targets, which involves decarbonising around 30 million buildings, which account for roughly 30% of the UK’s carbon emissions.

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Categories: Construction,