Construction output increased by 5.8% on a monthly basis in March this year, shows new ONS data.

Totalling £14.25bn of output, this is the most rapid growth rate witnessed since July 2020, when output grew by 17.8%.

This latest construction output figure is 2.4% – or £334m – above the February 2020 pre-pandemic level, the ONS adds.

Measured quarterly, construction output grew by 2.6% in Q1 2021, with a 2.8% rise in new work and a 2.2% increase in repair and maintenance the main drivers behind this.

During the first quarter of this year, the ONS data goes on to show, new orders increased by 12.2%, totalling £1.23bn, compared with Q4 2020. This is, however, 13.3% lower than new order numbers in Q1 2020.

While industry figures have cheered these positive monthly and quarterly figures, some do have warnings. Beard financial director Fraser Johns says: “An increase in demand and confidence boosted by the vaccine rollout and a roadmap out the crisis has played its part.

“Now the challenge is to build on that success by ensuring we attract the talented professionals required to take our industry forward.

“But in the short term we also have a significant challenge to face in terms of materials shortages, which in many areas is verging on a crisis.”

And McBains managing director Clive Docwra comments: “This is further proof of the construction sector’s continuing resurgence… one slight reservation is that while new contracts continue to come in, construction firms are being squeezed by soaring prices of imported materials, notably concrete, steel and timber.

“With margins already tight, the rising cost of raw materials threaten to negate any profit gains, so many construction firms remain on a knife-edge.

“These increasing costs also serve as a warning sign of global inflationary pressures, which could derail any sustained longer term growth.”

Meanwhile, Naismiths director Gareth Belsham points out: “While March’s gravity-defying, 5.8% jump in output may grab the headlines, it’s the industry’s solid growth across the first quarter as a whole that is most encouraging.

“The £1bn, 2.6% expansion over the quarter would be impressive at any time. But coming at a time when the UK was under strict lockdown and all other sectors of the economy were shrinking, it’s a testament to the construction industry’s resilience and ability to incorporate socially distant ways of working.”