Construction output plummeted by 40.1% in April as the sector felt the full force of the Covid-19 crisis, according to the latest figures from the Office for National Statistics (ONS)
Construction output plunged by 40.1% in the month-on-month all work series in April – this was driven by a 41.2% decrease in new work and a 38.1% decrease in repair and maintenance.
These decreases were the largest monthly falls on record since the monthly records began in January 2010.
The 41.2% decrease in new work in April 2020 was due to record month-on-month falls in all new work sectors – private new housing and private commercial were the largest contributors, falling by 59.2% and 39.7% respectively.
The decrease in repair and maintenance was thanks to record month-on-month falls in all repair and maintenance sectors – the largest contributor was private housing repair and maintenance which declined by 54.3%.
Construction output fell by record 18.2% in the three months to April 2020. This was driven by a 19.4% fall in new work and a 15.8% fall in repair and maintenance.
Construction faces ‘tough time to recover’
Commenting on the figures, Clive Docwra, managing director of McBains, said: “Today’s figures are further confirmation that the construction sector will face a hugely tough time to recover from the coronavirus pandemic.
“Particular concerns are private new housing work seeing a third consecutive month of large decline, exacerbated by the Covid-19 lockdown on April and now at its lowest level for a decade – bad news for the industry but also for prospective homeowners given the housing shortage.
“The record fall in private commercial new work also reflects the pause button being pressed on major projects.”
Docwra added: “Hopefully today’s [12 June] figures will represent the nadir given they cover the full month of lockdown, but while many large construction firms are now resuming work, many will still weakened by reduced order pipelines over the next few months.
“Firms are also experiencing labour shortages, supply chains are still operating extremely slowly and cashflow is becoming an increasingly pressing issue as cash reserves dry up.
“The government needs to stimulate demand, for example through reducing VAT on repair and maintenance work.”