Construction struggles continue as new work dips to a five year low
The value of new construction contracts in May reached £4.5 billion, a decrease of almost 10% compared to April and the lowest amount for over five years. The two largest sectors in construction - residential and infrastructure - both saw a decline as the 2018 slump continues. The latest edition of the Economic & Construction Market Review from Barbour ABI highlights levels of construction contract values awarded across Great Britain. The largest project by value across the month was the £130 million Wembley Stadium Station housing development. The residential sector saw a dip in activity of 5.7% compared to the previous month, but still managed to claim the top spot as May’s largest project by value.
Industrial and education were the only sectors in May that produced positive growth in contract values, increasing by 2.2% and 4.6% respectively month-on-month. The biggest fall came from commercial and retail construction which fell by almost 30% against April figures. Regionally, London was the region with the largest share of contract awards value in April with 18.8% of the total. The capital was followed by the East of England with 14%, and the North West with 13.5%.
Barbour ABI's Michael Dall says: “Across May we continued to see the decline in housing and infrastructure construction, with the value of new work in construction reaching its lowest point since January 2013. Whilst it is encouraging that the industrial and education sectors saw contract values increase, the deficit was too large to make up the shortfall, with both housing and infrastructure continuing in their slump.”
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