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Construction output reaches highest level after two years

Monthly construction output increased by 1.1% in volume terms in January 2022 and is now at its highest level since September 2019; this follows an increase of 2% in December 2021 and is the third consecutive monthly growth greater than 1.0%.

The increase in monthly construction output in January 2022 came solely from an increase in repair and maintenance (4.6%) as new work saw a slight decrease of 0.8% on the month.

Anecdotal evidence suggested some of the issues in sourcing construction products in the latter half of 2021 had continued to ease. Along with the easing of supply chain constraints, new orders in the construction industry continued to perform strongly, growing by 9.2% in Quarter 4 (Oct to Dec) 2021 compared with Quarter 3 (July to Sept) 2021. All new orders sectors had recovered to above their pre-coronavirus (COVID-19) pandemic level, highlighting demand for all types of work across the industry.

At the sector level, the main contributors to growth in January 2022 were private housing repair and maintenance and non-housing repair and maintenance, which grew by 5.0% and 5.5%, respectively.

The level of construction output in January 2022 was 1.4% (£197m) above the February 2020 pre-coronavirus (COVID-19) pandemic level. New work was 2.8% (£267m) below the February 2020 level, while repair and maintenance work was 9.3% (£464 million) above the February 2020 level.

The recovery to date (since the falls at the start of the coronavirus pandemic) is mixed at a sector level, with infrastructure 37.9% (£709 million) above and private commercial 27.8% (£693m) below their respective February 2020 levels in January 2022.

Alongside the monthly increase, construction output rose 3% in the three months to January 2022, and this is the strongest growth in the three-month on three-month series since June 2021 (3.4%), with increases seen in both new work and repair and maintenance (4% and 1.4%, respectively).

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