The UK construction sector in May 2024 witnessed a decline in main contract awards and planning approvals, but project starts showed growth.
- Civil engineering project starts surged, with a notable 86% increase compared to last year, totalling £8.137 billion.
- Rail projects led civil engineering starts, growing sevenfold compared to the previous year, followed by substantial energy sector growth.
- The East of England emerged as a key region for project commencements, driven by significant investments like the Eastern Routes Partnership.
- While some regions showcased growth, others such as the waste and water sectors saw notable declines.
In the UK construction industry during May 2024, while main contract awards and detailed planning approvals saw declines, project starts recorded a positive trend. Civil engineering work starting on site in the three months to May was valued at £8.137 billion, representing a 13% increase against the preceding three months and an impressive 86% rise from the previous year. Notably, major projects valued at £100 million or more witnessed a substantial 21% growth from the last quarter and a striking 150% increase on the previous year, totalling £6.510 billion.
Despite these positive signals, underlying project-starts valued under £100 million experienced a 41% decline against the preceding three months and a 9% decrease from the previous year. Meanwhile, civil engineering main contract awards, which totalled £2.441 billion, diminished sharply by 73% compared to the previous quarter, and were down 65% year-on-year. Major projects fell steeply by 80% from the previous three months and 71% from the previous year.
Contrasting these figures, rail projects dominated the civil engineering scene, accounting for 48% of starts, with values totalling £3.885 billion, reflecting a more than sevenfold increase from last year. Energy sectors also saw steep growth, rising 258% from a year prior to stand at £2.118 billion, representing a 26% share of civil engineering initiations.
Geographically, the East of England stood out, capturing 44% of project starts during the period, largely due to the £3.5 billion Eastern Routes Partnership. The region saw its project commencement values increase more than sixfold over the year. The South East followed, with project starts rising by 95% to reach £1.899 billion, and London also noted a 30% increase in project-start values, totalling £492 million.
Conversely, certain sectors experienced stark declines. Waste projects saw a significant 67% reduction, and the water industry projects plummeted 91% to a mere £26 million. Airport projects decreased by 94% compared to the previous year. Despite these downturns, some regional approvals flourished, particularly in the South East, which more than tripled to £1.267 billion over the past year, and Scotland, which increased 373% to total £743 million.
While the UK construction landscape faced mixed results in May 2024, signs of optimism emerged with significant regional and sectoral project starts.
