Despite an ‘eventful’ final week of June with a series of shocks sent through the economy, the construction sector managed to hold strong, with new orders reaching £6.2 billion, the highest figure of any month so far in 2016.
According to the June edition of the Economic & Construction Market Review from industry analyst Barbour ABI, the two ‘stalwarts’ of the construction sector, residential and infrastructure, both had year on year rises in June, with contract values increasing by 26% and 14% respectively.
London regained the top spot for construction contract value by location back from Scotland, which had held the position over the last two months, mainly due to a number of ‘major renewable energy projects’.
According to Barbour ABI, London’s construction boost in June was helped greatly by the award to develop Bechtel House Hammersmith, valued at £275 million, and the first phase of the £100 million Royal Albert Dock project. Both these major schemes are said o have helped propel office construction to a total of £650 million worth of contracts awarded during the month, contributing to 81% of all commercial and retail construction value.
Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said: “With the majority of the sector under the assumption that the UK would not vote to leave the European Union, the result left many surprised, and our June figures are under the assumption that it would be ‘business as usual’.
“We have seen housebuilder stocks fall in the wake of the vote and anecdotal evidence that projects are being cancelled. However, that is not evident in the data as of yet and it is a case of wait and see in terms of the impact Brexit may have.”
