November Construction Update from BEIS

The latest Monthly Construction Update from the Department for Business, Energy & Industrial Strategy (BEIS), which uses the Builders Merchant Building Index (BMBI) as one its sources, is now available.

Monthly construction output grew 1.3% in volume terms in September 2021 with the level of output now only 1% below its pre-pandemic (February 2020) level.

Both new work and repair and maintenance increased in September, but while new work output remains lower than before the pandemic hit, repair & maintenance work was 3.9% (£194 million) above its February 2020 level.

The annual rate of construction output price growth was the strongest since records began in 2014 with a 5.1% increase in September 2021. New housing and private industrial new work saw the largest increases.

The IHS Markit CIPS construction purchasing managers index for October also indicated that construction activity was gaining speed, but growth remained softer than in June. UK construction companies continue to report widespread supply issues. The Total Activity Index registered 54.6 in October, up from 56.2 in September, with housebuilding replacing commercial work as the best-performing category of construction work.

The latest Monthly Statistics of Building Materials and Components were published by BEIS on 3rd November. It shows that the material price index for ‘All Work’ increased by 23.6% in September 2021 compared to September 2020, but was up only marginally (+0.1%) compared to August 2021.

The latest BMBI report confirms the construction industry saw demand fall in August 2021 after a period of high demand in early summer, with builders’ merchants seeing a 7.9% decrease in sales compared to the previous month. However, sales are still at a high level; year-on-year sales were 23% up on August 2020 and 18.2% up on the same month in 2019. Timber & Joinery Products and Landscaping remained the best performing categories.

As well as the figures above, the update includes an assessment of the impact of Covid-19 and the ‘Business insights and impact on the UK economy‘ publication, which is based on responses from the voluntary fortnightly business survey (BICS), and construction sector forecasts by Experian and by the Construction Products Association.

The November update also includes statistics on the furlough scheme – which has now ended – from HMRC, as well as forecasts from the OECD’s latest economic outlook.

To download the latest BEIS Monthly Construction Update click here