hile the rollout of the Covid vaccine has raised hopes of a return to normality, a difficult winter and spring looms.
GDP in October confirmed slowing activity as month-on-month output growth fell to 0.4%. The imposition of restrictions to avoid the overwhelming of the NHS impacted output. The ONS’ data shows that the majority of bounce-back in activity had occurred by July and the subsequent recovery has disappointed.
The economy is now set to shrink in Q4 as November’s UK-wide lockdown forced a slowdown in activity. The recovery is also set to be weaker than previously expected due to a disruptive Brexit.
November sees marginal increase as contract awards reach £4.9 billion
Residential is the largest sector with 38.9% of awards whilst London is the leading region.
In the three months to October 2020, total construction output increased by 24.9% compared with the previous three month period (May to June 2020) according to the latest data release from ONS. New work saw 23.8% increase, whilst repair and maintenance increased by 26.8%.
New housing was particularly strong with the private sector showing 48.0% increase and public sector new housing up by 33.2%.
Also showing strong growth was the private commercial sector (15.9% increase) with the private industrial sector up by 14.9%. The housing sector was also at the forefront in the repair and maintenance sectors with 51.1% increase for the public sector, with the private housing sector also showing 40% increase on the previous 3 month period. However, annual comparisons show that the quarter to October 2020 is less positive that for the comparable quarter in 2019 with total work down by 9.9%, new work down by 11.8% and repair and maintenance output showing 6.3% decline. In addition, the annual comparison shows that with the exception of infrastructure new work, output for all sectors is between 3.3% and 29.6% lower in the October quarter 2020 than for the October quarter 2019.