Monthly construction fell by an estimated 0.2% in volume terms in January 2025 following a decrease of 0.2% in December 2024, according to the latest data from the Office for National Statistics.
The decrease in monthly output was caused solely by a fall in new work of 0.7%. Repair and maintenance work grew by 0.4%.
Anecdotal evidence from survey returns suggested adverse weather, including heavy rain, snow and storms, had had a negative effect on output.
Activity in three out of the nine sectors fell in January 2025. The main contributors to the monthly decrease were private commercial new work and private housing new work, which fell by 6.1% and 1.8% respectively.
Construction output is estimated to have increased by 0.4% in the three months to January 2025 off the back of a 1.4% increase in new work.
Clive Docwra, managing director of property and construction consultancy McBains, said: “January’s 0.2% dip in output, following an equivalent fall in December, serves as a warning that confidence among some developers remains fragile. In particular, the industry will be concerned to see private commercial new work falling by more than 6% and private housing new work by 1.8%.
“The worry is that any longer term stagnation in the wider economy risks having an impact in terms of investor uncertainty, which may lead to further projects being put on hold. The government’s Planning and Infrastructure Bill, published earlier this week, contains welcome measures to speed up the planning system, and the industry will hope this injects more confidence among developers and investors in the months ahead.”
Terry Woodley, MD of development finance at Shawbrook, added: “The year is off to a slow start, with three out of the nine construction sectors reporting a fall in figures. In particular, private commercial new work and private housing new work were the main contributors to this decrease in response to concerns around the UK economy.
“There is confidence that this won’t be the case for the rest of the year however, following the government’s continued calls to boost housebuilding through cutting planning red tape and streamlining processes, which is predicted to help councils deliver homes almost three times faster.
“Encouragingly, our latest research reflects how these measures are impacting property developers’ outlooks, with over 60% predicting that 2025 will see an improvement for both the residential and commercial property market. While the year has just begun, there are positive signs that this could be a stronger year for construction than recent months have shown.”
