Total value of construction contracts increases in June
According to the latest edition of the Economic and Construction Market Review by Barbour ABI, the value of all construction contracts awarded in June 2019 was approximately £5.2Bn, based on a three-month rolling average, which is 5.5% higher than the figure for May.
In delving further, regional analysis by Barbour ABI showed that the North West had the greatest proportion of contract awards, by way of value, in June with a figure of 36.6%, distantly followed by Greater London with a figure of 13.7% and the South East with a figure if 10.2%. The region with the lowest proportion of contract awards, by way of value, was actually Wales at an amount of 2.3%.
In contrast, by way of sector, infrastructure claimed the highest proportion of contract awards at a figure of 37.2%, though this is mostly a result of the SPRS Construction Programme at the Sellafield site in the North West, possessing a value of £1.5Bn and being the main factor behind the North-Western regional dominance.
Close behind the infrastructure sector in terms of the proportion of contract awards, by way of value, in June was the residential sector with a figure of 33.1%, the education sector with a proportion of 9%, the industrial sector at 8.1%, the commercial and retail sector at 6%, the hotel, leisure and sport sector at 5.2%, and lastly the medical and health sector with a figure of 1.4%.
Throughout June, London held the highest proportion of contract value in just two of the eight sectors, these being residential (26.2%) and commercial and retail (23.7%), while it was the East Midlands which dominated the industrial sector, largely due to investment in warehousing and storage.
Conversely, the South West claimed the highest proportion of contracts by value in the hotel, leisure, and sport sector whereas Scotland took the highest proportion for projects in the medical and health sector and the education sector, signifying that construction activity is spreading evenly throughout the country instead of concentrating in the capital.
The Chief Economist at Barbour ABI, Tom Hall stated, “For the first time this year, we see a shift in the spread of project awards across the country. Likewise, we see infrastructure investment overtake the residential sector, which has been the most active in construction for over six months.”
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