UK construction activity May 2024: Infrastructure

Main contract awards and detailed planning approvals fell against the previous year and the previous quarter. More positively, project starts grew on the preceding three months and a year ago.

Infrastructure overview

Totalling £8.137bn, civil engineering work starting on site during the three months to May increased 13 per cent against the preceding three months to stand 86 per cent up against the previous year. Major projects (£100m or more), totalling £6.510bn, increased 21 per cent against the preceding three months to stand 150 per cent higher than last year. Underlying project-starts (less than £100m in value) fell 41 per cent against the preceding three months on a seasonally adjusted (SA) basis and were 9 per cent down compared with last year, totalling £1.627bn.

Civil engineering main contract awards, adding up to £2.441bn, experienced a 73 per cent decrease against the preceding three months to stand 65 per cent down on the previous year. Underlying contract awards experienced a weak performance, decreasing 43 per cent against the preceding three months (SA) to stand 50 per cent down on 2023 levels. Major projects totalled £1.428bn, an 80 per cent decrease on the preceding three months and a 71 per cent decrease on the previous year.

Totalling £5.901bn, civil engineering detailed planning approvals fell 3 per cent compared with the previous quarter to stand 16 per cent down on a year ago. Major project approvals, at £4.309bn, decreased 7 per cent against the preceding three months, and fell 22 per cent on the previous year. Underlying approvals climbed 6 per cent (SA) against the previous three months and were 7 per cent higher than a year ago, totalling £1.593bn.

Types of projects started

At £3.885bn, rail projects accounted for the greatest share (48 per cent) of civil engineering starts during the three months to May having grown more than seven times on the previous year. At £2.118bn, energy also jumped 258 per cent on a year ago, accounting for a 26 per cent share.

Harbour/port projects were 2 per cent higher than last year, totalling £273m, accounting for a 3 per cent share of civil engineering starts. In contrast, accounting for a 1 per cent share, waste starts fell 67 per cent to total £54m. Water industry accounted for an insignificant share, totalling £26m, which was 91 per cent lower than a year ago. Airport projects also accounted for less than 1 per cent, at £5m, having decreased 94 per cent on a year ago.

Regional

The East of England accounted for 44 per cent of starts during the period, the highest of any area. The value of projects commencing in the region jumped more than six times against the previous year to total £3.619bn. Growth in the region was almost solely due to the commencement of the £3.5bn “Eastern Routes Partnership”. Accounting for 23 per cent of starts, the South East increased 95 per cent to total £1.899bn. London also experienced growth during the period. Accounting for 6 per cent of the sector, the value of project-starts in the region increased 30 per cent to total £492m. The West Midlands grew 711 per cent to total £434m, a 5 per cent share of civil engineering starts. In contrast, accounting for a 6 per cent share, project starts in the East Midlands slipped back 9 per cent to total £458m.

The East of England, at £1.696bn, was the most active region for civil engineering planning approvals, accounting for 29 per cent of the sector. The value fell 59 per cent against the previous year. A further decline was halted by the approval of the £1.48bn offshore wind farm in Norwich. The South East, on the other hand, more than tripled against the previous year to total £1.267bn, a 21 per cent share of the sector. Accounting for 13 per cent, Scotland increased 373 per cent to total £743m. Accounting for 11 per cent of consents, Yorkshire & the Humber increased 46 per cent on a year ago to total £664m. At £344m, the North East also experienced a strong period, having increased more than tenfold against last year to account for 6 per cent of consents.