Quarterly construction output continues to “outperform the wider economy”, despite the “disappointing” drop off in December 2024 output, latest Office for National Statistics (ONS) data shows.
According to ONS, quarterly construction output grew 0.5 per cent in volume in Q4 (October to December) 2024.
This was driven by 0.6 per cent (revised from 0.4 per cent) growth in November 2024, which followed an upwardly revised no growth period in October.
However, monthly construction output fell 0.2 per cent in volume in December 2024, due to a drop in repair and maintenance (1.8 per cent) while new work grew by 1.1 per cent.
Dr David Crosthwaite, chief economist at BCIS, said: “It’s good news that construction output grew by 0.5 per cent in the last quarter of 2024, outperforming the wider economy, which is estimated to have grown by just 0.1 per cent in the same period.
“Construction output growth was slightly better than expected given that the Christmas shutdown was included in the figures and the December numbers fell on a monthly basis.”
By sector, five out of the nine fell in December 2024, due mainly to non-housing repair and maintenance (down 1.8 per cent) followed by private housing repair and maintenance (down 1.1 per cent).
Meanwhile, new orders fell by 2.4 per cent (£231 million) in Q4 compared with Q3.
This quarterly decrease came solely from infrastructure new work and private industrial new work, which fell by 23.5 per cent (£496 million) and 19.7 per cent (£197 million), respectively.
The previous quarter saw total construction new orders fall 22.0 per cent (£2.7 billion) compared with Q2.
Nevertheless, annual construction output increased by 0.4 per cent in 2024 compared with 2023, the fourth consecutive year of annual growth.
However, Dr Crosthwaite described this marginal growth as “disappointing”.
The annual rate of construction output price growth was 3.0 per cent in the 12 months to December 2024.
Clive Docwra, managing director of property and construction consultancy McBains, said: “Despite the disappointing December return, the industry will take heart that new work orders actually grew during the month.
“A number of industry sectors will be looking forward with a degree of optimism in terms of the next few months.
“In particular, the recently published planning reforms and falling interest rates will hopefully inject new momentum into the housebuilding sector, although skills shortages and cost inflation on materials could still have an impact on significant growth across work sectors.”
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