CHESTER, England, November 21, 2013 /PRNewswire/ --
- Overall figures for construction activity grew by around 50 per cent in October compared to this time last year
- October 2013 saw a 16.1 per cent rise in housebuilding from September 2013
- Economists warn that growth must be sustained before construction is officially 'back on track'
The value of contracts awarded in the UK's construction sector grew by almost 50% in October 2013 compared to the same period in 2012, according to the findings of a new report. A sharp rise in the total value of activity saw figures reach £5.7 billion - a 9.7 per cent increase in one month alone.
These latest figures, taken from Barbour ABI's Economic and Construction Market Review, also highlight marked growth in the UK's residential construction sub-sector which grew by 16.1 per cent last month compared to September 2013. A significant proportion of this growth was from developer led projects, a sign of increasing confidence within the sector as Government schemes such as 'Help to Buy' continue to make an impact.
While confirming the residential sector as the current shining star of the industry, the report also emphasises positive 'green shoots' in other sub-sectors. Industrial in particular posted a positive October, with this area doubling the value of activity compared to the corresponding month in 2012.
Yet despite this decidedly positive picture of the construction industry, Michael Dall, lead economist at Barbour ABI, does call for caution: "The UK economic outlook has certainly been more upbeat recently with output rising, unemployment falling and inflation remaining around its target level. However this has to be put in the context of the macroeconomic indicators which show the gap between current economic performance and pre-crisis levels of activity.
"The Eurozone remains an issue for the UK, with growth weak and the risk of deflation in some countries remaining. In addition the consistent disagreements on the US budget as well as declining growth levels in China continue to act as external threats to UK economic recovery. Domestically, there is concern that the levels of productivity per worker will constrain the UK recovery and that remains a problem that will affect overall performance in the future. In addition the levels of UK economic debt and the continuation of austerity measures will also prove a strain on growth.
"These latest figures undoubtedly show positive signs, but the scale of future economic growth has still to be determined, and the first half of 2014 will be critical in assessing long term growth potential and knowing whether the construction industry is back on track."
As well as highlighting key sub-sector trends within the construction industry, data posted also identified regional variations in overall construction performance. Last month, London was the most prominent region, with the capital scooping 17 per cent of all contracts awarded. Scotland and the North West were a close joint second, with both securing 11 per cent of works.
The Economic and Construction Market Review is a new monthly report designed to give valuable, current insight into UK construction industry performance. The Review is compiled from the company's records of construction data for every UK planning application, and key indicators, such as the Office for National Statistics' Construction New Orders data.
The Economic and Construction Market Review will be published monthly and is available to download at http://goo.gl/VCcClD
About Barbour ABI:
Barbour ABI is a leading provider of construction intelligence services. With a team of in-house research specialists and a dedicated lead economist, it provides commercially relevant insight and unique analysis of trends and developments within the building and construction industry.
Barbour ABI is the chosen provider of industry data and indicators for Government bodies including the Office for National Statistics and the UK Government's Construction and Infrastructure Pipeline, which outlines future construction and infrastructure projects where public funding is agreed. Barbour ABI also provides data for independent organisations, such as the Construction Products Association.
Barbour ABI is part of global events-led marketing services and communications company, UBM, and is headquartered in Cheshire Oaks, Cheshire.
For more information, please visit http://www.barbour-abi.com
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SOURCE Barbour ABI