Construction figures show dip12 June 2018
Severe wintry weather at the start of 2018, rising costs and Brexit are to blame for a sharp drop in construction output, says the Federation of Master Builders (FMB).
The FMB’s statement followed publication of April ONS construction output figures which show that output in Feb-March declined by 3.4%, compared to the previous three months.
“The depreciation of sterling following the EU referendum has meant bricks and insulation in particular have become more expensive,” said FMB chief executive Brian Berry.
“We expect material prices to continue to squeeze the construction industry with recent research by the Federation of Master Builders showing that 84% of builders believe that they will continue to rise in the next six months.”
ONS figures also showed new orders in Q1 fell 4.6% quarter-on-quarter and 6.6% in annual terms. They did show that output increased 0.5% month-on-month in April.
Rebecca Larkin, senior economist at the Construction Products Association, said only the private housing and industrial sectors recorded growth, the former driven by the traditional spring selling season and the latter due to shorter lead times in factories and warehouses construction.
She said large falls in the infrastructure and commercial sectors, which account for almost one-third of total construction, are set to act as a drag on growth.