UK construction bounces back from doldrums

AFTER years in the doldrums, the construction sector recorded rising workloads in every part of the UK during the third quarter, according to upbeat figures released today.

The Royal Institution of Chartered Surveyors’ (RICS) construction market survey shows the most widespread increase in workloads in nearly ten years, since the middle of 2004.

Business activity for private house builders saw the sharpest rise, with the highest proportion of companies in the RICS survey’s 19-year history reporting growth in their workloads. The news is welcome for an industry that contracted which lost around 15 per cent of output in the five years after the financial crisis.

The surge in reported work has come on quickly: in the same quarter last year, workloads were flat, with one percentage point more construction firms reporting falling workloads than rising activity. The upturn is prompting more optimism. A net balance of 71 per cent of firms expect a higher workload in 12 months, the largest share since 1998.

Bank of England policymaker Martin Taylor rebuffed suggestions yesterday that the Bank should take a more active role in regulating house prices.

Last month, RICS suggested that house prices could be capped to rise by only five per cent per year. Taylor said he was “astonished”. “I don’t think, personally, that it should be the FPC's job to stop house prices going up.”