Commercial & Industrial lift for construction in July

• Starts in the three months to July were 4% up on a year ago, but 2% lower than during the previous three months (seasonally adjusted).
• Residential starts slipped 1% against the preceding three months but were 3% up on a year ago.
• Non-residential project starts were 3% higher than a year ago, supported by increases in office, retail and industrial work.
• Civil engineering starts slipped by 2% against the preceding three months but was 9% up on a year ago.

The value of work starting on site during the three months to July was 4% higher than a year earlier, according to the latest Glenigan Index. However, starts were 3% down on the previous three months on a seasonally adjusted basis.

Commenting on this month’s figures, Allan Wilén, Glenigan’s Economics Director, said: “The recent rise in private non-residential softened during the three months to July, but industrial, office and retail starts were all ahead of a year ago. Private housing project starts also softened and were down on a year ago. Social housing and community & amenity were both bright spots and were in contrast to falls in health and education work. An increase in infrastructure work has lifted civil engineering activity.

“Private residential starts softened further during the three months to July. Private housing starts slipped 3% during the three months to July against the preceding three months on a seasonally adjusted basis and were 7% down on a year ago. In contrast the recent turnaround in social housing starts has strengthened, with starts 4% up on the previous three months to stand 40% up on a year ago.

“Overall non-residential projects slipped 3% against the preceding three months on a seasonally adjusted basis but were 3% higher than a year ago. Private sector starts have been the main source of support. Although industrial and office starts were weaker than during the previous three months, they and retail starts were ahead of a year ago, rising by 3%, 20% and 20% respectively against a year ago. In contrast there was a general weakening in government funded sectors, with education starts 2% down on a year ago and health 32% lower, although community & amenity starts were 61% higher than a year ago.

“Civil engineering starts slipped by 2% against the three months to April on a seasonally adjusted basis, but were 9% higher than on a year ago. The year-on-year increase in project starts was led by a 32% rise in infrastructure projects against a year earlier. This was partially offset by a 23% drop in utilities work” 

Wales was the best performing part of the UK during the three months to July, with starts 46% up on a year ago. The West Midlands, Yorkshire & the Humber and Scotland also enjoyed double digit growth, rising by 16%, 38% and 28% respectively. The marked rise in Scottish starts follows almost 18 months of declining starts. The value of starts grew more modestly in the East Midlands, East of England and South West. In contrast, the value of starts in London, North East, Northern Ireland, North West and South East were 4%, 10%, 11%, 18% and 1% lower than a year ago. 

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