UK construction output down in August

UK construction output down in August
Published: 14 October 2011

Construction output rose 0.4 per cent MoM in August but fell 4.1 per cent compared with a year earlier on a non-seasonally adjusted basis, the Office for National Statistics said on Friday.

The ONS said construction output volumes in the three months to August were 1.9 per cent lower than in the same period a year ago.

The construction sector, which makes up 7.6 per cent of the UK’s GDP, grew by 1.1 per cent between April and June, but economists said Friday’s data suggested a weaker performance in the third quarter.

"Construction industry output appears to be collapsing," said Chris Williamson, economist at Markit. "The downturn in the construction sector provides further cause to worry about the overall health of the economy."

A survey of purchasing managers showed British construction activity stagnated in September after a contraction in the home-building and civil engineering sectors. This followed a slowdown in the pace of growth in August.

"The construction sector faces an extremely challenging environment, which threatens to limit activity over the coming months," said Howard Archer, economist at Global Insight.