April construction figures hit record low: ONS - Mortgage Strategy

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Construction levels in April fell by the largest amount since records began in January 2010 the latest ONS figures show.

The 40.1 per cent month-on-month fall across all construction was driven by a 41.2 per cent decrease in new work and a 38.1 per cent decrease in repair and maintenance.

New work on private new housing and private commercial were the largest contributors, falling by 59.2 per cent and 39.7 per cent respectively.

The figures show that in the three months from February to April, construction saw a decline of 18.2 per cent, the largest fall of any major sector of the economy.

Naismiths director Gareth Belsham says: “The construction sector’s famous volatility has long given it an unwanted reputation for boom and bust.

“But even the thickest skins have been pierced by the simultaneous collapse in demand and output unleased on the sector by the Covid crisis.

“Conventional construction techniques do not lend themselves to remote working or social distancing, and the closure of sites brought most work to a screeching halt in April.

“Even though the UK government eased lockdown restrictions on the sector much earlier than it did on other parts of the economy, the damage was already done.

“At over 40 per cent, construction’s month-on-month fall in output was more than double that seen in the services sector in April. Not all parts of the economy suffered equally.

“Fortunately, April’s brutal milestone may yet be the high-water mark for construction’s pain. With sites now reopened and work resuming, albeit under strict social distancing rules, the speed of decline is easing.

“But if April saw the moment of impact, the coming months will see the whiplash effect. Damaged business confidence and shrivelling levels of investment will continue to shake the construction industry for many months to come. The road to recovery will be long and fraught.”


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