UK Construction work fell by 0.2% in May compared to the month before, data from the Office for National Statistics shows, the third month in a row it has dipped.
The fall came solely from lower volumes of new work, down 0.4%, while repair and maintenance output was flat in the month.
Within the new work category, new private housing activity fell 1.7%.
The survey cites anecdotal evidence from firms who report customer’s worries about the economy as a reason for the slowdown. However, other companies add that inflation in the building industry continues to ease.
The report comes after the Bank of England hiked the base rate by 50 basis points to 5% last month, its 13th rate rise in a row since December 2021, taking it to the highest level in 15 years. The central bank is battling to calm inflation, currently at 8.7%.
May included an additional bank holiday for the coronation of King Charles III, which the government numbers body says may affect its estimates.
Over a three-month period, construction lifted by 0.2% in the three months to May, which came solely from a 2.5% rise in repair and maintenance work.
This is the ninth period of consecutive growth in the three-month-on-three-month comparisons. But it is the weakest period of growth since the 0.1% fall in the three months to last August.
Beard Construction finance director Fraser Johns says: “A reduction in construction output, prompted by a decrease in new order volumes certainly demonstrates how unpredictable the first half of the year has been.
“Nonetheless, the three-month picture saw a rise in output – if only marginally, thanks to demand for repair and maintenance.
“While some sectors are feeling the pressure, particularly private housing, and uncertainty in the wider economy may be inhibiting some clients from pulling the trigger on new work, this is certainly not the entire industry picture.
“At Beard, we haven’t seen a drop off in pipeline opportunities with strong signs of solid demand. In addition to commercial refurbishment projects, we have seen a broad portfolio of work with demand in care, education and with local authority as frameworks remain very active.
“For us and many firms across the industry, it’s all about remaining agile, minimising pressure on cost plans and responding to the opportunities still available.”
