Monthly construction output is estimated to have decreased 0.6% in volume terms in April 2023; this follows two months of consecutive growth, according to the latest ONS figures.
The decrease in monthly output came from a decrease in new work (1.0% fall), with a small offset from an increase in repair and maintenance (0.1%) on the month.
At the sector level, five out of the nine sectors saw a fall in April 2023, with the main contributors to the monthly decrease being private housing repair and maintenance and private housing new work, which decreased 5.7% (£149 million) and 3.0% (£99 million), respectively.
Anecdotal evidence suggested a continued slow-down in private housing, referencing economic worries with customers hesitant to request work; despite this, similar to last month, some companies across other sectors have again reported an easing in inflation.
Alongside the monthly decrease, construction output saw an increase of 1.6% in the three months to April 2023; this is the eighth period of consecutive growth in the three-month-on-three-month series; the increase came solely from a rise in repair and maintenance (5.7%), as new work saw a decrease of 0.9%.
Paul Sloman, Engineering and Construction Sector Leader at PwC UK, said: “April’s slight fall in output may precede worrying signs of a larger contraction in the market, a signal housebuilders could be holding back on new projects.
“The fall will add another building block of concern for those hoping to take a step onto the housing ladder, a significant blow despite signs that the economy may be taking a positive turn with an increase in growth.
“With the ONS stating the anecdotal evidence suggested a continued slow-down in private housing, referencing economic worries with customers hesitant to request work; housebuilders have some concerns about the continued challenging outlook in the sales market.
“Whilst it is encouraging that construction output saw an increase of 1.6% in the three months to April 2023; the increase came solely from a rise in repair and maintenance works (5.7%), this again prompts debate around the rate and scale of new construction projects getting underway, with new work experiencing a decrease of 0.9%.
“With estate agents and housebuilders bearing the brunt of the slowdown, plus the continued concerns about the lasting effect of higher interest rates, it seems that despite the positive economic news today, housebuilders are not quite out of the woods yet.”
