Counting the cranes
It has been said that you can assess the current state of the construction industry by counting the cranes in the sky across London but with the city a ghost town, we must look to the stats!
At Velocity we keep a close eye on the statistics surrounding construction, and recently it is making for interesting reading. The Office for National Statistics releases this information on a monthly basis with the full statistics from two months prior, all the stats mentioned in this blog are from July 2020, the next update is due early November and we will be sure to report back with any new findings. For now, on to the results.
Construction output is currently on a meteoric rise in comparison to previous years, what is unclear is if this growth is in direct response to the Coronavirus pandemic. In July 2020 construction output grew by 17.6%, this follows a record-breaking June where the growth was 23.5%. To put this into perspective, 2019 saw growth of 0.5% in July and actually a decline of 0.7% in June. The first thought looking at these numbers is obviously “the growth is in response to Coronavirus, the increased output are the jobs that were put on hold”. But it may not be as simple as that.
Growth in the sector hasn’t seen a steady rise for a while, even pre-Coronavirus the numbers showed slight rises and falls but never breaking more than 1% either way. As to be expected March 2020 saw a decrease of 5.9% as this was the start of lockdown. April was the record-breaking month for a decrease with a huge 40.1%, a slump like this hasn’t been seen since January 2010.
May 2020 is the starting point of the upward curve that we are currently on, seeing an increase of 8.2%, and as mentioned previously June and July follow the pattern. So, what does this mean for the construction industry? After suffering a decrease in outputs, similar to every other industry affected by Coronavirus, is construction set to be bigger than ever before?
We have discussed previously the government support now being deployed to aid the sector, things like the Green Deal are increasing new work coming in and giving construction room to breathe. It was one of the first sectors back to work following lockdown, but this was largely for projects that had to be put on hold. With the government funding vital housing work this gives construction firms the ability to hire new staff and get Britain back to building.
Whilst the statistics discussed open up a lot more questions than answers, those in the construction industry can breathe a collective sigh of relief that the worst is behind us. Whether you own a firm or are just looking start in the industry, more projects are coming and the sector continues to grow.
Velocity will continue to monitor these statistics, report any anomalies and remain a source of trustworthy information for those with an interest in construction.
