Market research firm, Leading Edge, has predicted that 2014 will herald a 4.2 per cent growth in construction output, with a slightly reduced 3.7 per cent expected in 2016. The figures indicate that growth this year would still be seen despite the potential for a hiatus in work due to the general election in May.
Concerning the past year, the prediction is that output will total £120.7 billion at 2011 prices. This is based on the numbers seen in the first 10 months of 2014. Further ahead, economists from Leading Edge suggest that the total construction output in 2018 will be six per cent higher than the £128.3 billion peak seen in 2007.
Leading Edge managing director Mel Budd commented: “We had previously forecast good growth in 2014 although the size of the increase was higher than expected mainly due to the strong rise in housing output which will end up with year on year growth of 20 per cent plus for 2014.”
The firm expects that this year’s largest drivers for growth will come from the private housing and commercial sectors, even though they continue to lag behind the high levels seen in 2007 and 2008.
Budd added: “New orders showed a small increase in Q3 2014 although there were some big variations by sector. We saw big decreases in public housing and industrial new orders, although we expect industrial to bounce back fairly quickly in 2015. Industrial output has shown good growth in 2014 and is forecast to continue this in 2015. However, it is still well below the peak output levels reached in recent years.”
In terms of region, Budd highlighted that London and the southeast made up 36 per cent of total construction output in the UK last year, predicting that these regions would further boost growth in 2015, while others are expected to perform better over the year.