The construction industry had a positive start to 2012 with continual growth over the first three months. However, a 4% decrease in project starts has overturned the prior growth and figures showing a sudden decline.
More specifically, a significant fall in social housing project starts is one of the main areas for the reason in such results. The prior growth in private housing projects figures ground to a halt cancelling out previous progress ultimately affecting the overall residential construction statistics.
Overall, regionally the most negatively affected areas include Yorkshire and the East of England due to a continual decline of new building contracts by 30% annually.
The latest information from Glenigan outlined that these combined factors which have led to a considerable 4% drop in April despite the encouraging growth in the three months prior, has been the biggest year on year decline since May the previous year.
It is safe to say that these disappointing numbers are in large part if not wholly due to continued cuts to public sector spending. This is seen in the reluctance of spending within health, education and community & amenity which have all significantly fallen despite the need in these areas.
Unfortunately it is expected that such figures are expected to continue well into 2012 as a continued result of government cuts. However there is some positive news with commercial project starts continual growth which is also forecasted to continue throughout the forthcoming year.
It is also predicted that previous growth in private housing projects will also begin to slow down over the next few months and building companies will notice a significant fall in available contracts by October.
Visit the Glenigan website for the full Glenigan Index for April including detail on construction companies as well as regional performance within the construction industry.