Construction Output Falls Again

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Construction output fell by 1.3% in June 2021, following a decline in repairs and maintenance work.

Materials price rises and shortages have also been blamed for the fall.

The Office for National Statistics reported that June output was 0.3% below the February 2020 pre-coronavirus pandemic level. New work was 2.1% below the pre-pandemic level, while repair and maintenance was 3.1% above.

Despite three monthly falls in growth for the months within quarter 2 (Apr to June) 2021, quarterly growth increased by 3.3% which, apart from quarter 3 (July to Sept) 2020, was the strongest quarterly growth since quarter 3 2013 (3.6%).

Fraser Johns, finance director at Beard, said: “For output to drop for the third consecutive month to below pre-pandemic levels, should start to ring some alarm bells. As an industry we’ve been saying for months now that the pandemic bounce-back could potentially be scuppered by a combination of the serious materials shortage, rising prices, labour shortages and now not enough HGVs on the roads to supply building sites.

It’s not the kind of prediction anybody wants to be right about, but today’s stats demonstrate that these issues are really beginning to bite.

“At the same time, it is encouraging to see quarterly levels of growth up 3.3% in Q2 compared to Q1, driven in part by new orders, but it is some way below the growth in the economy overall at 4.8%. And of course, that first quarter was spent still under lockdown.

“Right now, we have to work together with suppliers, surveyors, customers and consultants to be proactive about the issues we face and take a multi-step approach to things like procurement to manage our way out of this current decline.”

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