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Published: 20/02/2024
The Office for National Statistics (ONS) publishes quarterly data measuring the value and volume of main contractors’ new orders in Great Britain by sector and type of work. Its intention is to provide a forward-looking snapshot of both current confidence and potential future activity in the construction industry.
New orders at lowest level since pandemic lockdown
Total construction new orders decreased by 13.1% in 4Q2023 compared with 3Q2023, with significant falls in private industrial (-27.6%), private commercial (-18.0%) and private housing orders (-14.4%).
New orders in 3Q2023 had grown after three consecutive quarters of decreases, but the ONS data for the fourth quarter showed new orders fell to the lowest level since 2Q2020, when the industry was subject to lockdown restrictions.
Only new public housing showed positive growth, with 4Q2023 new orders up by 23.3% on the previous quarter, and up by 15.9% on 4Q2022.
On an annual basis, total new orders were down 30.2%. The biggest drop compared with 4Q2022 was in private industrial – down 52.2%.
| Sector | % change 4Q2023 on | |
| 3Q2023 | 4Q2022 | |
| New housing public | 23.3 | 15.9 |
| New housing private | -14.4 | -28.9 |
| Infrastructure | -0.1 | -26.9 |
| Public non housing | -13.9 | -26.1 |
| Private industrial | -27.6 | -52.2 |
| Private commercial | -18.0 | -30.4 |
| All new work | -13.1 | -30.2 |
Source: ONS – New Orders for construction: volume seasonally adjusted growth rates, by main contractor, by sector, constant prices, Table 2
Source: ONS – New Orders for construction: volume seasonally adjusted growth rates, by main contractor, by sector, constant prices, Table 2
Dr David Crosthwaite, Chief Economist at BCIS said: ‘With output figures for 4Q2023 confirming our recent suspicions that construction was in recession at the end of last year, the future pipeline also looks ominous with these significant falls in orders.
‘Levels of new construction are a direct response to investment levels and, if the cost of borrowing remains high, these declines are likely to persist well into 2024, making the year very challenging for construction.
‘It’s also difficult to be optimistic when looking at a sector like infrastructure. Publication of the recently updated National Infrastructure and Construction Pipeline, in which there was very little detail or clarity for investors to put their confidence, leaves more questions than answers about how the government can drive economic recovery forwards.’
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