The latest official data for new orders in construction could be read as good news. They show an up-tick of almost 5% in the first quarter of this year on the seasonally adjusted measure. That sounds promising on the face of it and many might claim that it is. But that would be to look at a small detail in a much bigger picture that looks far from promising.
UK architectural and engineering services businesses are now turning over more in cash terms than they were at the peak of late 2008. That at least is what the latest Turnover and Orders in Production and Services Industries data from the Office for National Statistics suggests.
The latest construction new orders figures give no comfort to those fearing a nasty second bout of recession in construction. The numbers bounced up a little in the third quarter but remain on a downward path if looked at on an annualised basis, as can be seen from the graph (more graphs below).
There was good news in today’s release of the latest GB construction output figures. The data was revised to show the second quarter growth rate at 1.1% rather than the 0.5% published a month ago. But for most in the construction industry it may be all a bit academic how we reinterpret the past. What matters more is what just happened and what does that tell us about what is going to happen. On this score the figures appear on…
There are times when you hope you’re misreading data or that there may be an error. But it doesn’t look as though these crutches are available as I stare at the carnage implicit in the new orders data. The index, which represents a seasonally-adjusted price-adjusted measure of orders taken by contractors for new work has hit a record low. It stands at 57.5 for the second quarter of this year. Five years ago it stood at almost double that. (see…
Did you see the FT piece with the Barbour ABI figures? What do you think? A bit worrying don’t you think? That set of questions in various guises came at me a few times yesterday as I was sipping a cappuccino in a sunlit Covent Garden cafe and while lunching on tapas with an old friend in Soho. My rare treat of an away day from numbers was not to be. Still. My initial reaction was: the figures may look scary, but…
Chatting to my good friend Martin Hewes about his latest regional forecasts he raised a point I had not really thought about that much before – the value of new orders for education work let over the past two years was twice the value for offices. In some regions the spending on education building makes the office sector look a bit like a side show. Great for those that specialise in educational building – well at least for the time being….
You wouldn’t expect a sharp rise in new orders for construction to be a cause for concern – not in today’s work-starved economy. But that is just what we have. On the face of it the 18% jump quarter on quarter in the volume of work in the final three months of last year should be a reason to cheer. More work in the pipeline, yippee. And I suppose it is not unreasonable to see it that way. But sadly…
The official figures for orders for new construction work in the third quarter of this year were not a particular surprise, but they do reveal starkly just how fragile prospects are for the industry. The graph below shows clearly the impact of the fiscal stimulus, which reversed the tailspin in orders. But now that public spending is in retreat we are seeing orders fall away at an accelerating rate. So in time we should expect to see the same for…
Construction is heading for a very nasty tumble next year after the current spurt in workload fades. That at least is the assessment of the first major industry forecast released since the Chancellor’s spending review announcements. The construction forecast by Hewes & Associates suggests that after an unexpected 5.6% rise in construction over this year as a whole, the industry will slide sharply by 5.8% next year and 4.8% in 2012. It is worth noting that the forecast by Hewes…