Construction up in September but infrastructure dips dramatically

With the first three months of post-Brexit figures in the books, construction sector contracts across September reached a total of £5.6bn, a minor increase on August, but the infrastructure sector continues to perform poorly, down by 44% on the previous month.

According to the October edition of the Economic & Construction Market Review from industry analysts Barbour ABI, it is still the residential sector that is playing a prominent role in stabilising construction figures across September. With the government pushing for more housing to be built and ambitious targets set, over £1.7bn of residential contracts were agreed during the month, a year on year increase of 12%.

Another sector that performed well in the past month was the hotel, leisure and sport industry, with construction contracts value worth over £500m, a massive 99% higher than a year ago. This was helped greatly by the commissioning of the Aberdeen exhibition and conference development worth £330m. The sector’s improved performance will be received favourably after a fairly stagnant year.

The most disappointing sector on the month was infrastructure, which was down by a substantial 44.5% on the month compared to September 2015. Additionally if it wasn’t for the £657m M4 smart motorway scheme in Berkshire, then this figure would be much lower.

Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said: “Overall, the construction sector has so far been robust enough to stave off the potential effects from the shock Brexit vote and has kept contract values at a healthy level, helped significantly by residential projects and the often wavering infrastructure sector.”

“A welcome boost for the industry would be an increase in contract values from other sectors outside of residential nd infrastructure, such as commercial and retail, which had its poorest month in September since May 2015.”

Click here to download the latest Economic & Construction Market Review.

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