Glenigan’s July Construction Review shows that planning approvals declined by 29% and project-starts are down by 26%, this is down 42% compared to last year.
The report also found that main contract awards also fell, 32%, when compared to the preceding three months, this is also 30% lower compared to the 2022 figures.
Glenigan’s economic director, Allan Wilden, said: “The construction industry continues to be buffeted by strong headwinds with little sign these are going to calm down in the near future. As our latest forecast shows, the next six months will likely be turbulent ones. Upcoming interest rate hikes will further hinder projects moving to site, and we are already seeing work falling back in the civil engineering sector with marked declines in both infrastructure and utilities.”
The report showed that the only sector to experience growth during the review period was Hotel and Leisure, project-starts increased 2% during the three months preceding June. Office starts declined by 38% and 57%, compared to the previous year, which the report claims is due to the weakening value of these properties.
“Whilst there are small signs of recovery in the long term, with positive private housing starts an example of stabilising conditions in some verticals, consumer and investor confidence still remains low, generally stifling activity in the here and now,” explained Wilden.
Glenigan’s regional analysis in the report found that Wales suffered the heaviest fall, declining 46% against the preceding three months and decreased by 52%, compared to a year ago. The East of England experienced a mixed period, increasing 31% but remaining 36% behind last year’s figures.
The report also shows that, despite an improvement in detailed planning approval performance at the start of the second quarter, figures decreased 29% compared to the preceding period – this is 1% lower than the year before.