Featured Region: Scotland

Underlying value of construction projects starting on site. (Excludes individual projects of more than £100 million and framework agreements).

Scotland endured a drop of 8% in the value of underlying project starts in 2011, a year which saw modest growth across the UK as a whole. Last year project starts stabilised somewhat but the decline of 1% was still worse than the UK’s performance as a whole.

The pattern of project starts was mixed last year; some sectors reliant on public funding outperformed, the health sector saw a gain in starts of 62%, however the education and social housing sectors both saw declines. Private sector activity also varied, retail starts fell by 52% last year, this was offset by rises in private housing and office work; both sectors were up 37% compared to 2011.

Official statistics show that output of construction activity declined by 10% during 2012, reflecting the declines we recorded in project starts in 2011. New public housing work saw the largest decline, down 31% from 2011 levels, closely followed by output of other new public sector work down 26%.

The first six months of 2013 have seen further declines in underlying project starts, down 27% compared to the first six months of 2012. Declines have been recorded across most sectors of the industry barring the office and retail sectors, which have made solid gains over the period. We expect starts to continue to decline throughout 2013 as tough conditions persevere leading to an overall fall for the year. Starts are expected to improve during 2014 in line with general economic conditions.

Scotland consists of the following Counties: Borders, Central, Dumfries & Galloway, Fife, Grampian, Highlands, Lothian, Strathclyde, Tayside, Orkney Isles, Shetland Isles, Western Isles.