Construction industry stumbles but don’t blame Brexit yet
The stumble in UK construction in the run-up to the referendum was worse than economists first feared, as housebuilding and property development fell back in the second quarter of the year.
Construction output dropped by 0.9 per cent in June, according to figures released by the Office for National Statistics (ONS) this morning. The decline left the industry 2.2 per cent smaller than it was last year, compared to consensus estimates of a two per cent decline.
However, the stats body said: "There is very little anecdotal evidence at present to suggest that the referendum has had an impact on output."
The UK construction industry is broadly the same size it was a decade ago.
Activity in the industry has been struggling throughout the year, with output falling in every month. In June, work fell in nearly all sections of the industry, with only public housebuilding and private industrial work managing to grow. The other components – repair and maintenance work, infrastructure, and private housebuilding – all declined.
Although the ONS cautioned against blaming the slowdown as a direct result of the referendum, surveys of businesses since the vote have suggested output is falling at its fastest rate since the recession in response to the vote. The Bank of England, for instance, has paid a lot more attention to post-referendum indicators such as the purchasing managers' index (PMI) which is more forward-looking than ONS stats.