In July 2024, the South West UK construction sector experienced notable fluctuations in activity, marked by varied performance across different project types. Key highlights include changes in contract awards and planning approvals, affecting several sectors such as private housing, healthcare, and infrastructure.
- Overall, there was a significant decline in the value of main contract awards both from the previous quarter and the prior year.
- However, detailed planning approvals showed an upward trajectory compared to the preceding quarter, despite being below last year’s levels.
- The private housing sector accounted for the largest share of project starts, while the utilities and health sectors saw gains in project approvals.
- A mixed performance was observed across other sectors, with notable growth in hotel & leisure project starts and a decline in infrastructure activities.
In July 2024, the UK construction landscape in the South West was characterised by mixed results among different project categories. The total value of work commencing on site reached £1.65bn, reflecting a five per cent decrease from the previous quarter but a one per cent increase year-on-year. Projects valued over £100m totalled £155m, marking a significant 52 per cent drop from the preceding quarter yet a notable 55 per cent increase compared to the same period last year.
The region witnessed a significant downturn in main contract awards, which fell 26 per cent against the previous quarter and 41 per cent compared to the previous year, amounting to £1.48bn. Specifically, major project contracts, totalling £113m, saw a 27 per cent decrease from the previous quarter and a steep 76 per cent decline over the past year. Underlying contract awards also experienced a six per cent fall from the previous quarter and stood 33 per cent lower than last year’s figures, aggregating to £1.37bn.
Conversely, detailed planning approvals appeared more positive, increasing by 18 per cent over the previous quarter, though they remained 37 per cent down year-over-year, reaching £2.59bn. Major planning approvals decreased by seven per cent against the previous quarter and were significantly lower than last year. On the other hand, underlying planning approvals improved, growing 23 per cent from the previous quarter and 18 per cent year-on-year, totalling £2.09bn.
Private housing remained the most prominent sector, representing 47 per cent of project starts in the region, with an impressive 15 per cent growth compared to last year, reaching £778m. The hotel and leisure sector also flourished, with projects tripling in value from the previous year to total £178m. In contrast, social housing reported an 11 per cent decline over the year, while infrastructure suffered a steep 41 per cent drop, totalling £125m.
The private housing sector also dominated detailed planning approvals, constituting 41 per cent of the total. In this domain, approvals fell by seven per cent over the year to £1.05bn. Yet, utilities demonstrated remarkable growth, jumping over fivefold to £659m, accounting for 25 per cent of approvals. The health sector showed substantial progress, rising 176 per cent to make up seven per cent of the total, at £176m. Additionally, office sector approvals surged, increasing fourfold compared to last year, totalling £138m.
Overall, the South West’s construction activity in July 2024 displayed a contrasting narrative with varied performance across diverse sectors.
