February construction output falls 1.9%, says ONS

The Office for National Statistics (ONS) estimates monthly construction output decreased 1.9% in volume terms in February, according to its latest figures. 

After a return to growth in January of 1.1%, the February's output value was £15,229m.

The decrease in monthly output came from decreases in both new work (2.3% fall), and repair and maintenance (1.4% fall).

Anecdotal evidence from survey returns suggested effects of heavy rainfall led to delays in planned work and decreasing output in February.

At the sector level, eight out of the nine sectors saw a fall in February, with the main contributors to the monthly decrease seen in non-housing repair and maintenance and private commercial new work, which decreased 2.5% and 4.0%, respectively.

The only increase was private housing repair and maintenance, which grew 0.2%.

Construction output is estimated to have decreased 1.0% in the three months to February.

This came solely from a decrease in new work (3.0% fall), as repair and maintenance increased by 1.6%.

However, other survey reports have given a more positive view of the sector. 

The most recent headline S&P Global UK Construction Purchasing Managers’ Index said the construction sector returned to growth in March.

Scott Motley, head of programme, project and cost management at construction consultancy firm AECOM, said: “The construction industry will be dismayed that output has slipped back into decline, as firms struggle to gather momentum in a sector that hasn’t notched up consecutive months of growth since 2022.

“Longer term prospects are improving though, with the Bank of England poised to begin cutting rates – boosting development activity as we enter the warmer months that are the most fruitful for contractors. 

“However, firms will still need to be alert to persistent challenges – namely elevated labour costs and an increasingly competitive tender market – which are hampering contract delivery while squeezing margins.”