Commenting on the new construction figures for July published by the ONS today (12 September) which show a second consecutive decrease in monthly construction output after seven consecutive months of growth, Clive Docwra, managing director of London-based property and construction consultancy McBains, said:
“July’s decrease in output in part reflects falling demand because of increasing cost of living pressures, and uncertainty over the UK economic policy given the contest over who would become the next Prime Minister.
“It has meant many clients – from households considering low-scale home improvements to investors and developers contemplating major new projects – held off committing investment.
“Supply bottlenecks are also continuing to impact, especially with materials coming from China being affected by the partial or full lockdowns in dozens of Chinese cities.
“The effect of Russia’s invasion of Ukraine is also starting to bite harder. Many construction firms were protected from the increases in energy and material prices because they used forward contracts for energy and to pre-purchase materials and products where possible, but that has merely delayed pressures that are now being felt more intensely.
“To ease the energy crisis, the construction sector would have liked to see the Truss administration support a major home insulation programme, which would not only help fix Britain’s leaky and energy-inefficient homes and help cut bills, but also provide work for smaller construction firms who are in particular feeling the pinch at present.”