Construction growth slows at start of 2014
The construction industry is a stronger position heading into 2014 than at this stage last year, according to the Glenigan Index for January, which was up by 4% year on year, driven by continued rises in infrastructure project starts. The value of main contracts awarded in the final quarter of 2013 was 21% higher than the previous year.
Activity in the office sector continued to rise at an increasing pace — up by 63% compared to the year before. However, the non-residential index fell by 2% over the three months to January owing to a slowdown of industrial and retail-sector growth.
Construction growth dipped slightly at the start of 2014 because of a slowdown in the industrial and retail sectors.
The rate has fallen compared to the 15% rise recorded to the three months to December 2013, with a 2% drop in the value of the non-residential index. Both sectors saw double-digit growth in project starts during the third and fourth quarters of 2013, but this rate slowed to 4% over the last three months.
The education sector continued the strong growth seen during 2013, with a 24% increase in project starts over the last three months.
Allan Wilén, economics director at Glenigan, commented, While the rate of growth at the beginning of the year suffers from comparisons to the very positive headline figure in the final quarter of 2013, the January index shows continued growth in private-sector activity — with further rises in office, retail and industrial starts painting a picture of sustainable private-investment-led growth in construction output.
‘The flow of projects receiving planning approval has been strong, suggesting developers are having some success replenishing their banks of prospective projects.
‘Low levels of Government spending will be less of a drag on growth of overall non-residential activity than in recent years.’