Pause in Construction Starts ahead of General Election

• Starts in the three months to November were 14% down on both the previous three months (seasonally adjusted) and a year ago.
• Residential starts were 18% down on the preceding three months and 15% lower than a year ago.
• Non-residential project starts were 12% down on a year ago, with most sectors seeing declines.
• Civil engineering starts were 27% down on the preceding three months and 18% lower than a year ago.

The value of work starting on site during the three months to November was 14% down against both the previous three months on a seasonally adjusted basis and against a year earlier, according to the latest Glenigan Index.

Commenting on this month’s figures, Allan Wilén, Glenigan’s Economics Director, said: “A weak performance during October and November suggests that the impending General Election may have prompted some clients to pause planned projects, dragging down the value of work started during the last three months. Residential project starts have fallen back 18% over the last three months to stand 15% down on year ago. Non-residential starts have fallen back with sharp falls in both private and publicly funded areas. Civil engineering starts were down on both the previous three months and a year ago.

“Private residential starts weakened during the three months to November. Private housing starts fell by 21% during the three months to November against the preceding three months on a seasonally adjusted basis and were 17% down on a year ago. Social housing starts also slipped back, falling by 11% against the previous three months and were 10% lower than a year ago.

“Overall non-residential projects fell 5% against the preceding three months on a seasonally adjusted basis and were 12% lower than a year ago. Industrial and commercial sector starts have declined sharply over the last three months. Industrial, office and hotel & leisure starts were 17%, 8% and 27% down respectively against a year ago, but retail starts recovered from recent sharp falls and were 2% higher than a year ago. Education starts were 9% lower than a year ago, while health projects were 11% lower. Community & amenity was a bright spot, rising by 24% against year ago.

“Civil engineering starts dropped by 27% against the three months to August on a seasonally adjusted basis and were 18% down on a year ago. The year-on-year fall in project starts was driven by a weakening in both infrastructure and utilities work.”

The East Midlands and Northern Ireland were the best performing parts of the UK during the three months to November, with starts rising by 34% and 22% respectively on a year ago. Projects starts in all other parts of the country were lower than a year ago. The sharpest falls were in the North East, South East, South West, West Midlands and Yorkshire & the Humber with declines of 29%, 20%, 24%, 29% and 32% respectively.

Glenigan Indices (underlying* projects up to £100 million)