Recent data reveals a notable decline in UK construction activities, with retail project starts and main contract awards experiencing significant downturns.
- Retail work starting on site fell by 36%, although it remains 8% higher compared to the same period last year.
- Main contract awards suffered a 25% decrease, showing a remarkable 30% decline when juxtaposed with last year’s figures.
- A bright spot appears as detailed planning approvals climbed 10% from the preceding quarter, marking a significant 39% rise year-on-year.
- Regional variations highlight the North East as the most active area, witnessing an 88% increase in retail starts.
The construction sector in the UK has experienced a noticeable decline in activity over the recent months, particularly in the retail domain. Project starts in the retail sector during the three months leading to July dropped by 36% compared to the quarter prior, although they were still 8% higher than the same period last year. Notably, no major projects valued at £100 million or more commenced during this period, contributing to the downturn.
Main contract awards have also seen a downturn, plummeting by 25% against the previous quarter and standing 30% lower than the corresponding period last year. This decline mirrors the absence of major projects, a trend consistent throughout the period.
On a more positive note, detailed planning approvals have shown resilience, increasing by 10% compared to the preceding quarter and rising 39% from last year. Underlying approvals also reflect growth, enhancing by 37% on a seasonal basis, totalling £510 million.
Sector-specific insights reveal that supermarket project commencements grew by 25% to £235 million, dominating 51% of all retail work. Shops experienced a 61% rise, culminating in £172 million, while petrol filling stations saw an over twofold increase, reaching £22 million. Conversely, shopping centres witnessed a dramatic deterioration with a 68% drop, concluding at £21 million. Notably, there were no retail warehousing projects initiated during this time.
Regional disparities are evident, with the North East emerging as the leading region for retail construction, marking an 88% increase to £69 million, accounting for 15% of all retail starts. Yorkshire & the Humber reported a near fivefold increase, totalling £58 million, while the South East grew by 111% to £52 million. The West Midlands experienced a 180% surge, reaching £48 million. Interestingly, the South West and Scotland also reported notable growth, though the North West saw a 25% decline, highlighting the varied landscape across regions.
While challenges persist, the upward trend in planning approvals offers hope for future growth in the UK construction sector.
