February construction output has rebounded by 2.4%, following a 1.7% fall in January 2023, making February the highest monthly value in level terms since records began in January 2010
The increase in the February construction output came from increased repair and maintenance and new work.
Evidence has suggested that the reason for the increase in February construction output was due to a bounce back from the fall in January 2023, and continued strength across the repair and maintenance sector.
An improved weather forecast in February allowed for more projects to go ahead
Many firms also noted an improvement in the weather in February, which allowed for projects to go ahead.
Across the sector, eight out of nine areas saw a rise in February 2023, with the main contributors to the monthly increase seen in private housing repair and maintenance and non-housing repair and maintenance, which increased 5.0% and 3.7%, respectively.
Alongside the monthly increase, construction output saw an increase of 0.9% in the three months to February 2023, which is the sixth period of consecutive growth in the three-month-on-three-month series.
Despite the increase, there was a general slowdown in housing in recent months
The increase came solely from a rise in repair and maintenance (3.1%), as new work saw a decrease (0.5% fall).
The main positive contributors to the increase in the three months to February 2023 were non-housing repair and maintenance (5.5%) and infrastructure new work (2.8%), with the main negative contributor being private new housing (4.4% fall).
Despite the increase in February construction output, evidence suggested a general slowdown in housing across recent months.
An increase in repair and maintenance could reflect wary attitudes towards new-build construction projects
Mike Hedges, director at Beard Construction, said: “Like many other key sectors, construction has been unable to avoid the challenges of the last nine months or so. However, it is positive to see the landscape beginning to improve with an increase in output and the highest monthly value seen since January 2010.
“While it’s encouraging to see a marginal increase in new work, we shouldn’t be surprised to see repair and maintenance continuing to lead the recovery effort. This could in part reflect customers being wary about committing to large new-build construction projects but could also reflect the emerging direction of trying to maximise value from existing assets, reducing waste and preserving embodied carbon.
“Looking beyond February at the three-month picture though, infrastructure new work was a key contributor to growth. This certainly mirrors the broad portfolio of projects we’re working on and the tender opportunities we’re currently seeing at Beard.
“It’s further proof that firms need to remain agile and pivot toward more resilient sectors that will continue to provide opportunities, such as specialised infrastructure projects for local and central government. This is especially true for those firms reliant on residential building or housebuilding, which continues to be challenging with higher mortgage rates and borrowing costs stifling new-build demand. It will be encouraging to see the challenges on these sectors ease later this year with the slowing of interest rate increases.”
