Experts cast doubt on poor construction figures

Sector looks hopeful as construction giants throw their weight behind staying in the EU

Construction experts have shed doubt on the latest official figures from the Office for National Statistics (ONS), which report a sharp decline in building activity across the UK.

Citing signs of a struggling economy and uncertainty over June’s European Union referendum, the latest Construction Output report from the ONS reveals that activity fell by 1.1% in the three months to March.

And, in March, output plunged by 3.6% compared with February - the worst month-on-month figure since December 2012.

But, while the ONS reports that only housebuilding saw a growth in the first quarter, with infrastructure projects lagging far behind, experts claim the outlook is actually better than is being claimed.

I just don't believe these output figures. They don't ring true with what the industry is experiencing on the ground, with strong demand across all segments and growing order books

Speaking to BBH , Richard Threllfall, partner and head of infrastructure building and construction at KPMG, said: "Apologies ONS, but I just don't believe these output figures. They don't ring true with what the industry is experiencing on the ground, with strong demand across all segments and growing order books.

“Yes, the housing sector had a weaker-than-expected start, but is warming up nicely in the spring sunshine, and the civils market remains very strong thanks to pipelines of activity in road and rail. Sweepstake, anyone, on how long before we see an upward revision of the numbers?"

The ONS report comes shortly after a recent poll by Building Magazine revealed that 63% of construction professionals believe that staying in the EU would be the best overall outcome for the industry.

Over 1,300 construction professionals took part in the survey, with particular concerns highlighted from the respondents if the UK leaves the EU including a potential fall in foreign investment, higher labour and material costs, and house price volatility.

Commenting on the upcoming vote, Mace chief executive, Mark Reynolds, said: “I believe it is of vital importance for both the construction industry and UK plc that we remain in the EU.

“Not only does membership of the EU give us access to the European market, which allows us to export services and recruit the best talent, but leaving the EU will deter investment and add further delay to infrastructure decisions that are crucial to the country’s long-term economic future.”

Other business leaders within construction who have spoken out in favour of staying in the EU include the chairmen of construction consultants, Mott McDonald; and property services experts, JLL.

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