Featured region: Wales

Following the 34% decline in starts during 2013, the value of construction output in Wales slipped back 2% last year. Activity was supported by a 15% rise in repair and maintenance work due to spending on housing improvements, while new work fell back by 10%. Low levels of public and private housing work weighed heavily on the principality. Infrastructure remained more positive, with an 8% rise during the year building upon a 12% increase in 2013.

A 23% rise in private housing had led the rise in output in 2013, but sector output fell back by 14% last year and continued to decline at the start of 2015. Public new housing output also weakened last year, but has seen a turnaround during 2015.

Housing R&M work fell back at the beginning of the year after the surge in 2014, weighing on output growth. All work output was down 7% year on year during 2015 Q1; new work output fell just 2% but R&M activity was down 17% compared to a year earlier.

The figures for commercial output remain negative. Activity was down 48% on a year earlier during the first quarter, after a 23% fall during 2014. 

Industrial construction output is on an upward trend. However whilst the sector enjoyed a sharp 63% rebound in output last year, it was from a low basis. The sector accounted for around 2.5% of Welsh construction output in 2014; accordingly the strong expansion in 2014 had little impact on overall workload.

Welsh Output Growth 2014

Glenigan Data

Recent years have proved volatile for construction activity in the principality. In 2012 Glenigan recorded a 20% rise in the value of project starts in Wales, which fed through into strong output growth seen in 2013. Disappointingly, project starts then fell back sharply, with a 34% decline during 2013. There was then a resurgence in project starts during 2014, with the value of underlying starts 40% up on a year earlier. Starts continued to expand, albeit at a much reduced rate, during the first quarter of 2015, but subsequently crashed by 34% during the three months to May.

The final quarter of 2013 showed signs of a new recovery in project starts. The value of underlying project starts rose by 6% compared to a year before, with strong rises in new starts of office and retail projects. This recovery then accelerated in 2014, with year on year growth of at least 28% seen in every quarter.  After this rapid rate of growth last year starts appear to now be stabilising, having dipped 2% year on year in the first quarter of 2015.