Education

Education

Education – Overview

Main contract awards and detailed planning approvals all fell on the previous year and the previous three months. More positively, project-starts experienced a boost against both the preceding quarter and last year

Totalling £1,285 million, education work starting on-site experienced a 35% increase on the preceding three months and grew 21% against the previous year. Major projects (£100 million or more) starting during the period added up to £185 million, unlike the previous quarter and the first quarter of 2022 when there were no major projects. In contrast, underlying education work starting on-site (less than £100 million in value) experienced a 5% decline against the preceding three months on a seasonally adjusted (SA) basis but grew 4% on a year ago.

Education main contract awards fell 7% against the preceding quarter to total £1,092 million, with the value remaining 22% lower than the previous year. Underlying contract awards performed poorly, slipping 7% (SA) against the preceding quarter to stand 11% down on the previous year. There was an absence of major projects reaching the contract awarded stage, differing from the previous year but remaining unchanged against the preceding quarter.

Totalling £1,076 million, detailed planning approvals decreased 4% against the preceding three months and were 19% lower than last year. No major projects were granted approval during the period, in contrast to the previous quarter and last year. Underlying project approvals decreased 7% (SA) against the previous three months and were also 7% down on a year ago.

Education – Types of Projects Started

School project-starts totalled £653 million during the first quarter of 2023 and accounted for the largest share of education construction starts (51%), thanks to the 15% growth on the previous year.

Universities were the second most active segment for project-starts, accounting for 27% of the total value, having increased 60% against last year, to total £345 million.

On the other hand, college project-starts performed poorly, with the value decreasing 61% against the previous year to total £70 million, accounting for a 5% share of education work starting on-site.

Regional Analysis – Project-Starts

The South East was the most active region for education project-starts during the three months to March, accounting for a 26% share of the sector to total £332 million, having doubled from last year’s levels. The growth was boosted by the £185 million Schwarzman Centre humanities building in Oxford (Project ID: 21126120). Wales was the best performing region for education project-starts in terms of growth, accounting for 23% of the sector. Starts in Wales totalled £293 million, which is more than five times higher than the first quarter of 2022. Northern Ireland accounted for 8% of starts in the sector and almost tripled against the previous year, to total £98 million.

Scotland also experienced growth (+49%) against the preceding year. Project-starts in the region totalled £84 million to account for 7% of the total value. This growth can be almost exclusively attributed to the commencement of the £65.73 million Currie Community High School development in Edinburgh (Project ID: 19316055). Yorkshire & the Humber was another region where the value of project-starts increased (+61%) against the previous year, totalling £82 million and accounting for 6% of the sector total. In contrast, despite having the same share of project-starts, the West Midlands slipped back 43% compared with the first quarter of 2022, bringing the total value down to £80 million

Education Project-Starts during the three months to March 2023

Regional Analysis – Detailed Planning Approvals

The North West experienced a strong period for detailed planning approvals in the education sector, with the value having more than tripled against the previous year to total £172 million, a 16% share of the total, making it the most active region. The North East was another area experiencing high growth. The value tripled compared with last year’s levels, totalling £148 million to account for 14% of the sector. Projects in the North East included a £35.07 million school in Durham (Project ID: 22436133). Approvals in the West Midlands were 4% up on a year ago, adding up to £125 million, which is a 12% share of the sector. Totalling £102 million, approvals in London also increased 17% on the previous year to account for 9% of the sector.

Consents in the East of England grew 58% on the 2022 levels to total £114 million, an 11% share of education approvals. In contrast, despite accounting for the same proportion of the sector, Scotland slipped back 47% against the previous year to total £115 million. Further decline was prevented by a £33.36 million school in Edinburgh (Project ID: 22098673). At £110 million, the South East also fell 36% on the first quarter of 2022 to account for a tenth of the sector.

Education Detailed Planning Approvals during the three months to March 2023

Forecast Construction-Starts for Education

Note: Underlying projects are schemes with a construction value of £250,000 to £100 million.  Forecast updated in April 2023 p – provisional, f – forecast.
Source: Glenigan