Figures released today (23 October) reveal that the level of construction contracts awarded increased in September to the value of £5.6 billion – the highest since January.
Barbour ABI’s latest Economic & Construction Market Review reveals the total value of new contracts awarded in September increased by 5.8% from the month before, with values 11.7% higher than September 2013.
Unlike recent months, where residential construction has dominated the proportion of new contracts awarded, there was more of an even split across key sectors in September. Residential accounted for 24%, closely followed by infrastructure (23%), commercial & retail (22%) and education (14%).
Michael Dall, lead economist at Barbour ABI, said: “Today’s figures will give a huge boost to the construction industry, particularly those in the education sector, which is celebrating its highest level of new contracts awarded in two years.
“Over recent months, it has become clear that the industry cannot only rely on the residential sector to instigate long-term growth – other key sectors such as commercial and infrastructure need to improve to make the recovery more resilient.
“While infrastructure is still performing poorly compared to pre-recession levels, today’s report appears to indicate a widening of construction activity with growth more evenly spread. With recent forecasts from the Construction Products Association also predicting 23 per cent growth by the end of 2018, this positive news looks set to continue.”
The report also showed that London and Scotland were the hotspots for the value of construction contracts awarded in September, accounting for 24% and 21% of the UK total respectively. This was largely down to a handful of big ticket projects including Phase 2 of the £600 million Battersea Power Station contract, a new bypass to the west of Aberdeen worth £400 million and a £300 million on-shore wind farm based in the Highlands.