Finance / Construction output slips in fourth quarter despite upsurge in activity in December
Construction output slips in fourth quarter despite upsurge in activity in December
12 February 2016
Britain's construction output slipped in the final three months of last year, despite an upsurge in activity in December, a report has said.
The Office for National Statistics said building output shrunk 0.4% in the fourth quarter compared to three months before, failing to meet expectations of a 0.1% drop.
It said the decline came despite output growing at its fastest pace in December since April 2015 when it clocked up a 1.5% rise compared to the month before.
Growth in the final month of the year was buoyed by a 12% leap in infrastructure work, which rose into positive figures for the first time since July 2015, the report said.
The fourth quarter decline was fuelled by a drop in repair and maintenance work, which saw a 1.4% slip offset by a 0.2% increase in all new work, the ONS said.
It reported that construction output for the whole of 2015 had grown 3.4%, lower than “historically strong growth” of 7.5% in 2014.
Howard Archer, UK and European chief economist at IHS Global Insight, said: “There are some positives for the construction sector going forward, but it is clearly vulnerable to confidence among clients being pressurised by heightened UK and global economic uncertainties.”
The latest update on the construction sector came as the Bank of England slashed its growth forecasts for the UK economy and voted to keep interest rates on hold at 0.5% last week.
It cut its forecast for UK GDP for the next three years, to 2.2% for 2016, 2.4% in 2017 and 2.5% in 2018.
The ONS also released the latest data on UK trade earlier this week, showing Britain’s trade gap had grown to its highest level since 2010 last year, as the UK saw an £8.1 billion plunge in the export of goods.
It said the deficit – the difference in value between UK imports and exports – widened by £300 million to £34.7 billion in 2015.
Photo from Yui Mok / PA Wire