2nd November 2020

The value of underlying work (under £100 million) starting on-site during the three months to October was 14% lower than a year ago, however increased by 26% compared to the preceding three months on a seasonally adjusted basis.

Residential starts declined 16% against the previous year but increased 35% on the preceding three months.

Non-residential work commencing on-site climbed 10% on the preceding three months but declined by a fifth compared to the previous year.

Civil engineering experienced a strong three months, rising 22% on the previous year and 52% against the preceding three months.

Rhys Gadsby, Glenigan’s Economic Analyst, commented on this month’s figures, “The three months to October marked a strong recovery in the value of work starting on-site in all sectors and regions against the lows of the previous three month period. The value of construction work starting on-site in October alone was almost double that of May.

“Project-starts are still heavily below pre-pandemic levels, but the gap is narrowing. The value of work commencing on-site in October was 14% lower than a year ago, whereas in May construction-starts were 46% lower. However, with the winter period now approaching, Britain’s relationship with the European Union still uncertain and with the initial backlog of delayed project-starts now cleared, we anticipate growth to be slow over the coming months through to 2021.”

Sector performance

“The value of residential work during the three months to October declined 16% against the previous year but climbed 35% on the preceding three months on a seasonally adjusted basis.

“Private housing work starting on-site has experienced the sharpest growth compared to the preceding three months, rising 43%. However, starts were still 16% lower than a year ago.
Social housing project-starts increased by a fifth against the preceding three months, but also declined 16% compared to the previous year.

“Non-residential projects commencing on-site declined by 20% compared to a year ago, but climbed 10% on the preceding three months (seasonally adjusted).

“The health sector experienced the biggest rise in the value of project-starts against the previous year, rising 30%. Starts also increased 37% against the preceding three months.

“Office starts during the three months to October climbed 6% against the previous year and 47% compared to the preceding three months.

“The value of hotel & leisure project-starts experienced the sharpest fall of any sector, declining 54% compared to a year ago. Work commencing on-site also declined by a quarter against the preceding three months.

“Education starts also suffered steep declines of 32% against the previous year and 17% compared to the preceding three months.

“The civil engineering sector experienced an exceptional three months to October, with the value of work starting on-site increasing 22% on the previous year and 52% on the preceding three months on a seasonally adjusted basis.

“The value of utilities project-starts experienced the greatest rise against the preceding three months of any sector, rising 122%. Starts also climbed 8% compared to a year ago.

“Infrastructure work commencing on-site increased 30% on the previous year and 28% on the preceding three months.”

The Marketing to Contractors & Housebuilders feature (which is sponsored by South East Construction Expo) in the Sectors section of our Directory provides an overview of the sector, including
details of its various media channels and events, together with access to our downloadable database of those with responsibility for procurement at key firms.

UK Regions start to return to growth

“The value of project-starts in most UK regions were still lower than a year ago. However, a few regions achieved growth for the first time since the national lockdown began in March.

“Construction-starts in Wales experienced the greatest rise with an increase of 24% compared to a year ago. Against the preceding three months (seasonally adjusted) starts climbed 12%.

“The West Midlands and South West also had a relatively good three months to October, with the value of starts rising 7% and remaining unchanged on the previous year respectively. Work commencing on-site increased by 55% in the West Midlands and 52% in the South West compared to the preceding three months.

“Despite a fall in the value of project-starts of 15% on the previous year, Scotland experienced the sharpest growth against the preceding three month period with a rise of 74%.
Work starting on-site in the East Midlands during the three months to October declined 38% against the previous year; the heaviest fall of any region. Starts fell 27% in both the East of England and North West.

“The East Midlands, South East and North East were the only three regions to experience declines in the value of project-starts compared to the preceding three months, with falls of 2%, 6% and 8% respectively.”

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