New construction orders grow for two quarters
New construction orders for the second quarter of 2012, excluding infrastructure, were 6.1% up on the previous quarter and 10.9% up on the last quarter of 2011. Second-quarter orders for 2012 were 6% up on the same quarter in 2012. However, they were 4.7% down on the high of the third quarter of 2011. Figures are based on 2005 prices, seasonally adjusted.
The growth from the first to the second quarter of was due to public non-housing and public and private housing. Private commercial and private industrial both fell. In the second quarter, private projects accounted for 44% of new starts compared with 49% in the second quarter. The balance in the final quarter of 2011 was 42% private and 58% public.
Commenting on the figures, Steve McGuckin, UK managing director of programme-management consultancy Turner & Townsend, commented. The headline number is positive, but the good news is thin. Most of the quarter-to-quarter growth is being delivered by the public sector. While the extra work is good for the construction industry, it isn’t a sign of growth or confidence in the economy as a whole.
‘There’s no hiding that across most of the private sector, orders are down — and this is placing huge pressure on the construction industry.
‘The pressure is causing a split between the limited number of big players who have a strong balance sheet and the capability to deliver the big projects, and the small and medium-sized firms which are being squeezed to breaking point by ever-greater competition.’