Signs the UK construction market is slowing!

 

Office Construction Still Booming

According to the Office of National Statistics there are warning signs that the UK construction market is slowing down. In their recent Statistical bulletin release on the 8th of September 2017 they cite the 6 following points:

  • Construction output contracted by 1.2% in the 3 month on 3 month series in July 2017 but remains at relatively high levels. Source Office of National Statistics (ONS)
  • The 3 month on 3 month decline in output was due to decreases in both repair and maintenance, which fell 1.8% and all new work, which fell by 1.0%. (ONS)
  • Construction output also fell month-on-month, falling by 0.9% in July 2017, predominantly driven by a 1.4% fall in all new work. (ONS)
  • Both the month-on-month and 3 month on 3 month series fell for the fourth consecutive month in July 2017. (ONS)
  • New orders fell 7.8% in Quarter 2 (Apr to June) 2017 compared with the previous quarter, dropping to its lowest level since Quarter 1 (Jan to Mar) 2014. (ONS)
  • The decrease in new orders in Quarter 2 2017 has stemmed from falls in both all new housing, which fell 4.9% and all other work, which fell by 9.0%. (ONS)

Despite the relatively high levels of output, it seems that the effects and uncertainty that Brexit is bringing is possibly starting to rear its ugly head. Whilst media coverage persists over the lack of apparent progress in the Brexit negotiations a fall in new orders of 7.8% is hardly surprising. Perhaps this is a trend that may reverse itself but it is hard to see the decline being stemmed in the current political climate.