Construction output flat in November

Construction output remained broadly flat in November but was down 1.6% on the same period a year ago, the latest ONS figures have revealed.

The ONS figures for November 2011 showed the total volume of construction output remained broadly flat, increasing by 0.2% in November compared with October.

But the figures showed a fall in output of 1.6% compared with November 2010.

Total output for the three months to November fell 1.2% on the same period a year ago, the figures revealed, while the volume of new work between September and November 2011 fell 1.3% compared with the same period in 2010.

The figures for the three months to November showed a 14.7% increase in infrastructure work compared with the same period in 2010 and a 2.8% rise for commercial work. Non-housing repair and maintenance also rose by 4% over September-November when compared with 2010.

Noble Francis, economics director at the Construction Products Association, said: “Construction output remains extremely subdued having fallen for three of the previous four months and output in the fourth quarter of the year is now likely to fall, mirroring the recent disappointing economic news from the manufacturing sector.

“The recovery in private sector construction is still very sluggish and with the anticipated sharp falls in public spending on construction in 2012, the industry is now expected to see a fall in output of over 5% this year, with no sign of recovery until 2014.”

Simon Rawlinson, head of strategic research at EC Harris said the figures showed that broadly the trend since June 2011 of  “steady but lower level of work” had been sustained into the fourth quarter of 2011. 

But he said the significant slowdown in activity suggested by first and second quarter new orders data was still not reflected in the output data.

He added: “Overall output for 2011 is set to be nearly 3% higher than 2010 in real terms – a pretty impressive performance.However, as stated by ONS, the three month year-on-year trend is down by 1.2% - nothing near the forecast levels of output reduction expected in 2012.

“Overall the industry is doing better than expected – particularly infrastructure, where output is 11% higher in the first 11 months of 2011 compared to 2010.  Furthermore, although output in the public sector has fallen compared to 2010 – levels of activity have remained pretty steady during 2011 – we haven’t fallen off a cliff yet.

“Looking forward, the pain that the industry anticipates still is not being felt in output terms, but can only be around the corner with a sluggish housing market and big public sector cuts to come.  Nevertheless the resilience of the industry during 2011 has been a big plus for UK GDP.”