ONS construction output fall will add pressure to housing inflation

ONS construction output fall will add pressure to housing inflation

13:43 PM, 11th June 2021, About A week ago 3

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Monthly construction output fell by 2.0% in April 2021 compared with March 2021, falling to £13,961 million, and was the first month-on-month fall since December 2020 when output fell by 2.2%.

This follows comparatively strong growth of 5.8% in March 2021. Anecdotal evidence received from survey returns suggested increased new work, delayed projects returning to sites, and a general increase in demand and confidence across the industry, as well as unusually warm weather were contributing factors to the large monthly increase in construction output in March 2021.

Figure 1 below shows overall construction output index in April 2021 dipped slightly following strong increases in February and March 2021

Despite the 2.0% fall in April 2021, the level of construction output remains 0.3% (£44 million) above its February 2020 pre-pandemic level, with a mixed profile of recovery at type of work level (Table 1).

While repair and maintenance was 7.1% (£348 million) above the February 2020 level, new work is yet to recover fully and remains 3.4% (£305 million) below it. Infrastructure is the only new work sector to have recovered above its February 2020 pre-pandemic level, at 21.2% (£386 million) above it.

Figure 2 shows all new work sectors except infrastructure had lower output in April 2021 than in February 2020 before the pandemic

The 2.0% fall in construction output in April 2021 represents a fall of £290 million in monetary terms compared with March 2021, which was the first monthly fall in output since December 2020 when it fell £291 million (2.2%).

Figure 5: A large fall in private new housing work drove the monthly decline in construction output in April 2021

New work fell by 2.9% (£261 million) in April 2021 compared with March 2021, which was the first fall since December 2020 when it fell by 3.4% (£290 million). Private new housing was the largest contributor to the monthly decline, falling by 11.1% (£352 million), which was the largest decline since April 2020 when it fell by a record 59.1% (£1,714 million).

Private housing repair and maintenance and private commercial new work also saw large month-on-month falls of 7.1% (£144 million) and 6.2% (£134 million) respectively. As shown in Figure 6, the three largest contributors to the monthly decline in April 2021 all saw strong growth in March 2021.



Comments

by Mick Roberts

15:54 PM, 11th June 2021, About A week ago

The falls nothing to do with shortage of building materials & massively increased costs of building materials is it?

I'm having 3 fences done & Wowzers whopping increase in materials & no choice as same all over.
New extension, that's gonna cost me 2k more than original price.

I'm sure everyone else feeling the same when having their next jobs done. And some of us doing cheaper than should be rent, some'at has to give.

by JB

11:02 AM, 14th June 2021, About 7 days ago

Reply to the comment left by Mick Roberts at 11/06/2021 - 15:54
My bloke couldn't get any cement recently. It seems all building materials have gone up in price - if you can get anything close to what you want.

Same with white goods where usually my 1st 3 choices are unavailable so I have to settle for something much more expensive.

by Mick Roberts

11:10 AM, 14th June 2021, About 7 days ago

Reply to the comment left by JB at 14/06/2021 - 11:02
Yes same here with cement & last year plaster.

Wow white goods too. We have some bike lads who have got to wait 18 months for some gear shifters & levers. Car waiting lists have gone up, I've just bought 2 new cars for me & daughter, waited about 2 months, but if order same cars now, 7 months.

The lads can't get new bikes now quickly, the second hand ones are going up in value.


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