Glenigan Index confirms large drop in new construction jobs
The total value of new construction projects in the UK has fallen by 21% over the last year, according to the November edition of the Glenigan Index. Residential projects starting on site saw a 31% drop. Non-residential projects were down by 20% as a result of the sharp reduction in construction starts in the office and industrial sectors. The value of public-sector construction starts, including education and health projects, has also weakened. Although this sector is thought likely to struggle in the near term, investor confidence is expected to stabilise during 2009, while new health and education projects in the pipeline should result in a modest improvement in the sector from the third quarter of 2009. Allan Wilen, economics director with Glenigan, says, ‘Construction in every pat of the UK has been affected by the fallout from the credit crisis. While the Bank of England’s decision to slash the base rate may help rekindle confidence and money-market liquidity in due course, we anticipate a further weakening in new-project starts over the next nine months, which will continue to be a drag on industry output into 2010.’ The index is based on Glenigan’s extensive database of construction projects and tracks the monthly flow of construction projects valued from £100 000 up to £100 million starting on site each month.