New Figures Show UK Office Construction On The Rise
When a new government was elected in July, one of its chief mantras was to ‘get Britain building again’, especially when it came to housing. However, it appears that the strongest area of construction is now the commercial sector.
That situation may appear odd in some places, such as central Manchester, where new office partitions have been needed far less than new bathrooms and balconies for apartments as the residential sector has dominated the city centre building boom with its plethora of new skyscrapers full of apartments.
Whether it is the first hints of change in Manchester or just a sign that things are different elsewhere, the latest S&P Purchasing Managers Index for construction has revealed that while the overall output of the sector was up from October, the real strength lay in commercial work, which has seen its best performance in two and a half years.
By contrast, the residential construction sector saw a downturn, with the second successive month of contracting activity, making it the weakest sub-section of the construction sector.
Economics director at S&P Tim Moore observed that, overall, the construction sector “bucked the slowdown seen elsewhere across the UK economy in November”, but that its recovery “remains somewhat lopsided”.
It may be that, with annual house price rises now running at nearly four per cent according to both the latest Nationwide and Halifax House Price Indexes, the property market recovery will prove enough to stimulate a revival in residential construction soon.
Nonetheless, the growth in the commercial sector does mean, whatever it says about the wider economy, that demand for office partitions, furnishings and other fixtures, fittings and equipment is set to be high over the coming months as the newly-built structures are fitted out.
Whether this lasts is another matter, with Mr Moore noting the survey has shown declining business confidence across construction, often over issues that may hold back other commercial firms, such as rising employment costs. For now, however, office construction is having a moment in the sun.