Strengthening in civils work steadies construction starts
- Starts in the three months to August were 9% down on a year ago and were 1% lower than during the preceding three months.
- Residential starts were 16% lower than a year ago with social housing projects especially weak.
- Non-residential project starts were 5% lower than a year ago with a weakening in industrial, commercial and community & amenity starts partially offset by a sharp rise in health projects.
- Civil engineering was 15% higher than a year ago due to a strong recovery in utilities work.
The value of work starting on site in the three months to August was 9% lower than a year ago, according to the latest Glenigan Index. On a seasonally adjusted basis, starts were 1% lower than during the three months to May.
Commenting on this month’s figures, Allan Wilén, Glenigan’s Economics Director, said: “The value of underlying projects starting on site remains subdued. The latest Glenigan Index for August was 9% down on a year ago and little changed on the weak level of starts seen so far in 2018. The Index reveals a general decline in residential and non-residential building projects starting on site during the last three months, most notably in social housing, commercial and community projects. However, against this downward trend, there has been a strengthening in health and civil engineering work.
“Private residential starts during the three months to August were 9% down on the same period a year ago. On a seasonally adjusted basis starts were 1% up on the three months to May. Social housing starts have fallen sharply, dropping 13% against the three months to May on a seasonally adjusted basis and being 36% lower than a year ago.
“Overall non-residential projects were 5% lower than a year ago and 4% down against the three months to May on a seasonally adjusted basis. Sharp falls in office and community & amenity starts contributed to the decline against the preceding three months. Year on year declines in industrial, office, hotel & leisure and community & amenity projects overshadowed a 50% rise in health project starts and a modest recovery in retail sector work.
“The recent upturn in civil engineering activity is continuing, with the value of underlying starts during the three months to August up 15% against both the preceding three months (seasonally adjusted) and the same period last year. The year on year rise was driven by a 73% rise in utilities work.”
Performance regionally has been mixed. London, Yorkshire & the Humber, Scotland and Northern Ireland saw double digit declines in starts, being 29%, 16%, 23% and 17% lower respectively than a year ago. The North East and Wales both saw a sharp rise in starts, with year on year increases of 43% and 21% respectively, while project starts in other parts of England were little changed on a year ago.
[1] See notes for definition of underlying starts
Glenigan Indices (underlying* projects up to £100 million)
|
|
Glenigan Index |
Residential |
Non-residential |
Civil engineering |
||||
|---|---|---|---|---|---|---|---|---|
|
|
Index |
% Change |
Index |
% Change |
Index |
% Change |
Index |
% Change |
|
Aug-17 |
153.8 |
-7% |
216 |
0% |
122 |
-7% |
99 |
-35% |
|
Sep-17 |
150.7 |
-7% |
199 |
-10% |
124 |
-3% |
118 |
-13% |
|
Oct-17 |
140.9 |
-14% |
193 |
-11% |
111 |
-12% |
109 |
-28% |
|
Nov-17 |
137.5 |
-14% |
184 |
-11% |
110 |
-16% |
110 |
-24% |
|
Dec-17 |
122.7 |
-13% |
166 |
-9% |
101 |
-12% |
84 |
-36% |
|
Jan-18 |
143.2 |
-13% |
185 |
-11% |
123 |
-14% |
105 |
-22% |
|
Feb-18 |
138.8 |
-10% |
181 |
-11% |
119 |
-6% |
94 |
-22% |
|
Mar-18 |
151.3 |
-14% |
188 |
-15% |
129 |
-12% |
134 |
-20% |
|
Apr-18 |
133.6 |
-9% |
166 |
-8% |
116 |
-3% |
111 |
-28% |
|
May-18 |
137.2 |
-11% |
165 |
-10% |
120 |
-10% |
124 |
-20% |
|
Jun-18 |
141.6 |
-7% |
181 |
-12% |
118 |
-4% |
123 |
7% |
|
Jul-18 |
144.2 |
-7% |
188 |
-11% |
117 |
-9% |
125 |
25% |
|
Aug-18 |
139.8 |
-9% |
182 |
-16% |
116 |
-5% |
114 |
15% |
Note: *, underlying projects are valued over £250,000 and under £100 million