Glenigan survey indicates a bounce back in activity
The value of new work starting on site in August and September was well above a year earlier, according to the latest Glenigan Index for the period July to September 2015. It was only a weak July that saw the underlying value of new schemes starting on site during the third quarter being 2% earlier than a year earlier. The improvement in August and September was driven by private housing, commercial and industrial project starts.
The strongest area of expansion was in private housing, with the value of starts up 15% on a year earlier. This private-residential sector has been the strongest construction sector during 2015 so far, with starts up 9% over the first three quarters compared to this stage a year ago.
Non-residential starts were down 6% on a year earlier as modest growth in private-sector activity was insufficient to outweigh continued weakness in the public sector.
There was growth in industrial starts (10%), retail (7%) and offices (3%). The hotel and leisure sector slipped back 7%.
Education starts have edged back into growth, up 1% on a year earlier. This sector was buoyed by £20 million-plus starts at Edinburgh, Birmingham City and Leeds universities.
Allan Wilén, Glenigan’s economics director, comments, ‘During the first three quarters of this year, the underlying value of projects receiving planning approval has risen by 15%. Moreover, of the 11 construction sectors, nine have seen growth — pointing to progress across the industry.
‘Approvals are up in 11 of the 12 constituent English regions and nations of the UK, with only the capital seeing approvals down compared to a year earlier. This points to the recent rise in confidence, evidenced by the strong levels of starts during August and September, driving widespread growth in construction over the coming 12 months.’