Construction News quotes David Savage on the slight rise in construction output in September
Construction output rose slightly in September despite an overall fall in UK gross domestic product (GDP).
The industry’s output rose 0.4% according to the Office for National Statistics, the third consecutive monthly of growth for the sector as the country heads towards recession.
David Savage, Partner comments:
“Construction output saw another increase in September - a third consecutive display of monthly growth – a sign that the industry is holding strong during an obviously difficult period.
Although the cost of construction remains high, and further volatility over the medium term can be expected as the energy crisis bites harder, new work and increasing confidence across the sector seems to have carried some momentum over the last quarter.
Nonetheless, while this is encouraging data for construction, it is a backwards facing view. With the certainty now of recession in 2023, and materially higher interest rates for the medium term, a significant number of developers and investors will be looking to press the pause button until the economic realities of inflation have become clearer. In addition, the UK Government has clearly been reviewing – on a line by line basis - both current and planned capital investment around all major projects.
It remains to be seen how the sector reacted in October amid the political turmoil triggered by Truss’ mini budget and subsequent resignation.”
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