The UK construction sector has experienced a period of decline in the closing months of 2023, with output falling for three consecutive months, according to the latest data from the Office for National Statistics (ONS). This downturn represents a concerning trend for an industry that has, until recently, seen three years of consistent annual growth.
The Current Landscape
In December 2023, construction output saw a 0.5% decrease in volume terms, culminating in a 1.3% fall from the third to the fourth quarter. This decline was primarily driven by a significant 5% drop in new work, although repair and maintenance activities showed a 4% increase, indicating a shift in the sector's focus.
The detailed figures reveal a more nuanced picture, with new work falling by 1.1% in December alone, while repair and maintenance managed a modest 0.4% increase. Despite these recent setbacks, the annual outlook for 2023 shows a 2% increase in construction output compared to 2022, marking it as the third consecutive year of growth.
However, new orders in the construction sector paint a bleaker picture, with a sharp 13.1% decrease in the final quarter of 2023 compared to the preceding three months. This decline was most pronounced in the private commercial and industrial sectors, which fell by 18% and nearly 28%, respectively.
Economic Implications and Industry Response
The annual rate of construction output price growth has also seen a slowdown, registering at 3.1% in the 12 months to December 2023, a significant reduction from the record highs of 10.7% witnessed in mid-2022. This slowdown reflects the broader economic challenges facing the UK, including high interest rates and ongoing economic unpredictability.
Industry experts, such as Clive Docwra, Managing Director of McBains, have expressed concern over these trends, highlighting the impact of reduced new housebuilding and infrastructure work. With the UK economy officially entering a recession in the last quarter of 2023, the construction sector is at a critical juncture, facing uncertainty in the year ahead.
The Role of Find A Start
In these challenging times, platforms like Find A Start play a crucial role in supporting the construction industry. By connecting contractors with skilled tradespeople efficiently, Find A Start helps to mitigate some of the impact of declining new work and orders. Our service provides a streamlined way for contractors to find the necessary workforce and for tradespeople to find consistent job opportunities, even in a fluctuating market.
As we navigate through these uncertain times, the anticipation for the upcoming budget statement is high, with hopes that it will introduce measures to rejuvenate the construction sector. For contractors and tradespeople looking to adapt and thrive, Find A Start offers a valuable resource to stay connected and secure work in a challenging economic landscape.
For more insights and to discover how we can support your construction needs, visit our website at www.findastart.co.uk.