Is the construction industry 13% bigger than we think it is and does it matter?
Here’s an intriguing puzzle. Why would an alternative measure of construction activity suggest the industry is about 13% bigger than the official construction output figures show? Also, why would this measure of the annual increase in capital goods resulting from construction (gross fixed capital formation) suggest the industry has fallen 20% from peak rather than the 10% the construction output figures suggest? This has been bugging me for some time and some months ago I turned to the Office for…