New project starts ‘abnormally weak’ into January

Activity was lower than expected at the start of 2022, with project starts at their lowest ebb since the first lockdown.

Construction intelligence provider Glenigan said the level of new starts had been “abnormally weak” in January, based on its analysis of jobs with a value of £100m or less.

The value of underlying work starting on site fell 15 per cent in the three months to end of January against the preceding three-month period (August to October 2021), and dropped 31 per cent when compared with the same period in 2021.

Supply chain and labour issues have created challenges, with delays to starts blamed on clients reassessing project costs and deciding to hold off on work.

Residential, civils, utilities and office sectors reported a continuing trend of falling project starts. Industrial builds, which had shown strong demand last year, also dropped 18 per cent in the three months to end of January 2022 when compared with the preceding three months.

Hotels and leisure stood as the only sector in growth, with output 35 per cent higher than the previous three months.

Glenigan’s senior economist, Rhys Gadsby, said that even though the industry was off to a weak start, there were signs that the situation could improve. He said: “We are starting to see some of the socioeconomic challenges gradually easing, and this is being evidenced through a growing pipeline of planning approvals and main contract awards.”

Although project starts reached a low, orders in construction rose for the month of January, as a response to the easing of COVID restrictions. Commercial construction in particular saw a rise in new orders.