UK construction in the South East showed mixed performance in June 2024, with varied results across different sectors and project types.
- Project starts in the South East in June totalled £4.12bn, showing significant growth both quarterly and yearly with major project starts witnessing a notable rise.
- In contrast, the value of main contract awards decreased markedly, both from the previous quarter and year, indicating volatile market conditions.
- Detailed planning approvals also saw a decline compared to previous periods, with some sectors experiencing more pronounced impacts.
- The utilities sector led project starts with impressive growth, while private housing, despite being the most active in approvals, faced a decline.
In June 2024, the South East’s construction sector provided a varied picture of activity. Project starts reached a robust total of £4.12bn, representing a substantial 16% increase from the previous quarter and a remarkable 24% rise compared to the previous year. A highlight was major project starts, each valued at £100m or more, which surged by 72% from the previous quarter and soared by 103% compared to last year, amassing a total of £2.05bn.
However, this positive trajectory in project commencements was offset by a sharp decline in main contract awards, which recorded a steep fall of 50% from the previous quarter, totalling £2.84bn, and showed a year-on-year decline of 62%. Major contract awards were particularly impacted, plunging 89% from the previous quarter and dropping 92% year-on-year to just £317m.
Detailed planning approvals also presented a downtrend, decreasing by 24% compared to the preceding quarter and dipping 14% year-on-year to a total of £4.01bn. Major project approvals fell by 57% from the preceding quarter and 37% from the previous year. The underlying approvals, devoid of major projects, slightly decreased by 2% from the previous quarter on a seasonally adjusted basis and were down 4% from the previous year.
The utilities sector emerged as the most substantial contributor to new project starts, accounting for 45% of the activities and witnessing an extraordinary value increase to £1.85bn, over 25 times that of the previous year. The health sector also demonstrated considerable growth, jumping 234% to £345m and securing an 8% share of project starts. Education projects saw a 60% rise against the previous year, reaching £170m and marking 4% of the total starts in the region.
Although private housing remained the most active segment in detailed planning approvals, making up 48% of such activities, it experienced a 23% decline in value to £1.91bn when compared to the previous year. Conversely, the office sector saw significant growth in approvals, up 49% to £583m, while industrial projects approvals increased by 88% year-on-year to £289m.
The South East’s construction market in June 2024 was characterised by significant growth in project starts, particularly in large-scale initiatives, amid a backdrop of declining contract awards and planning approvals.
