Construction statistics, Great Britain: 2019

• The value of construction new work in Great Britain continued to rise in 2019, reaching its highest level on record at £118,977 million; this was driven by growth in both public sector work of £3,008 million and in the private sector of £2,897 million.
• Construction new orders grew by 2.5% in 2019 following the fall of 13.2% in 2018; this represented an increase of £1,516 million.
• The number of construction firms operating in the construction industry fell sharply in 2019, falling by 10.9% compared with 2018 to 290,374 registered firms operating in Great Britain.
• There were 3,502 insolvencies in the construction sector in Great Britain in 2019, the highest of any sector.
• Construction-related employment in Great Britain fell by 6.0% in 2019, which is the first annual decline since 2014 when it fell by 0.1%.
• Average weekly earnings in the construction industry in Great Britain grew by 1.8% to £648 per week in the year to December 2019, which was below the 2.8% increase for the whole economy.
• The UK trade deficit in construction materials and components fell by £152 million to £10,421 million in 2019, though imports remain more than double the value of exports as all three components of building materials saw a trade deficit.
• All data in this release relate to 2019 and therefore are before the impact of the coronavirus (COVID-19) pandemic; for further information please see the Office for National Statistics (ONS) public statement on COVID-19 and the production of statistics.

The Office for National Statistics (ONS) publishes monthly statistics on construction output in Great Britain, which can be found in the monthly output in the construction industry statistical bulletin and associated datasets. It is worth noting that while the monthly construction release focuses mainly on volume, seasonally adjusted data, this annual publication focuses mainly on current price, non-seasonally adjusted value data. This publication includes the following data tables on construction output (Tables 2.4a to 2.4c, 2.8 and 2.9 in the accompanying dataset).

Figure 1 depicts the split of new work – into public and private sector work – between 2009 and 2019. Figure 1 shows that public sector work makes up a smaller proportion of all new work accounting for approximately a quarter of all new work, with the private sector accounting for the other three-quarters. The share of public and private new work of total construction output has remained broadly the same since 2012.

All new work grew by 5.2% (£5,905 million) in 2019 compared with 2018, to £118,977 million, which is the highest level in this series since records began. This growth is stronger than the 3.1% growth in 2018, but down on the 9.9% recorded in 2017.

The increase in all new work was because of increases in both public and private new work. Public new work increased by 10.8% (£3,008 million), which mirrored the 2018 annual growth and was the largest annual growth in public new work since 2010 when it grew by 24.6%. Private new work grew by 3.4% (£2,897 million) – a pick-up in growth following the 0.8% increase in 2018.

Over the last decade, private housing has driven much of the growth in new work, accounting for 34.1% of all new work in 2019. The only sector that saw a decrease in 2019 compared with 2018 was private infrastructure, which fell by 6.9% (£751 million).

Despite the fall in private infrastructure, total infrastructure new work grew by 4.0% (£905 million) in 2019, because of a 14.5% (£1,658 million) increase in public infrastructure new work.

The strength of public infrastructure new work in comparison with private infrastructure new work is illustrated in Figure 3. Apart from 2018 and 2019, public infrastructure new work was last greater than private infrastructure new work in 1996.

The Office for National Statistics (ONS) publishes construction new orders data quarterly, using data sourced from Barbour ABI. The ONS construction new orders provide an indication of both the current confidence and future health of the construction industry. Total construction new orders data can be broken down into two main sectors: all new housing and all other new work.

This publication includes the following data tables on construction new orders (Tables 2.5 and 2.6 in the accompanying dataset).

The value of all new orders saw continued year-on-year growth between 2012 and 2017. In 2018, there was a fall of 13.2% (£9,335 million), however, it should be noted in 2017 a large number of new orders relating to High Speed 2 (HS2) were placed. All new orders returned to growth in 2019, increasing by 2.5% compared with 2018, though despite this growth of new orders in 2019, this remains 4.5% (£2,958 million) below the 2016 level.

In 2019, infrastructure drove much of the annual growth in new orders, increasing by 14.5% (£1,675 million). As can be seen in Figure 5, despite the large fall in electricity new orders, much of this annual growth in 2019 in infrastructure came from new orders in the road and rail sectors.

The Office for National Statistics (ONS) produces an array of data on the structure of the construction industry, including breakdowns on employment, trade, size and number of firms using data from the ONS Inter-Departmental Business Register (IDBR).

This publication includes the following data tables on industry structure (Tables 3.1a to 3.1c, 3.4a, 3.4b, 3.5 and 3.6 in the accompanying dataset).

Number of firms

Figure 6 shows the concentration of construction firms as a percentage by region in Great Britain. The South East and London were the most common areas for construction firms to be registered in 2019, with 17.2% and 15.5% respectively of all firms registered there, followed by East of England with 13.1%.

Users should note that data in Figure 6 relate to where individual firms are registered on the IDBR and therefore despite representing a good indicator of where construction firms are operating, construction firms may carry out work across wide geographical areas, not just in the region in which they are registered.

Figure 6: Construction firms were concentrated around both London and the South East in 2019

Nomenclature of Territorial Units for Statistics (NUTS1) regions of Great Britain

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The number of construction firms operating in the construction industry decreased in 2019, with 290,374 registered firms operating in Great Britain. This is a decrease of 10.9% compared with 2018, with falls across all regions. In the recent years preceding this, the number of construction firms had been following a steady increase, reaching its highest level on record with 325,736 registered firms operating in Great Britain in 2018.

Figure 7 shows the growth rate of the number of registered construction firms in England, Scotland and Wales as well as Great Britain as a whole.

Across all these regions, the number of registered construction firms in 2019 fell, being the lowest growth on record. In the recent periods prior to this fall in 2019, growth had already been starting to slow.

The largest decrease was seen in England, with 32,691 (11.2%) fewer registered construction firms. In comparison, the smallest decrease was seen in Wales, with 953 (7.3%) fewer registered firms, though Wales accounts for a very small proportion of overall construction firms. Scotland has 1,728 (8.5%) fewer construction firms registered. Overall growth rates of construction for Great Britain as a whole in 2019 saw a decrease of 10.9%, this being 35,362 fewer firms than in 2018.

Within English regions, London and the North West of England saw the largest decreases in the number of registered construction firms, with 8,770 (16.3%) and 4,018 (13.0%) fewer registered firms in 2019 respectively compared with 2018. The West Midlands saw the smallest decrease, with 2,259 (9.1%) fewer registered firms, followed by the East and South East of England, with 3,899 and 5,151 (both 9.3%) fewer registered firms respectively.

Insolvencies

The volatile nature of the construction industry is evident in the number of insolvencies seen within the industry. According to data from The Insolvency Service, there was a total of 18,268 new company insolvencies in Great Britain in 2019, with the top 10 industries with the most insolvencies accounting for 16,362 of these. The construction industry had the largest number of company insolvencies in 2019, with 3,502, around a fifth of all insolvencies.

Figure 9 shows the total number of new company insolvencies in the construction sector in England and Wales in 2019, broken down by UK Standard Industrial Classification (SIC 2007) divisions 41, 42 and 43 with detailed splits at the three-digit UK SIC 2007 level.

Of the 3,293 new company insolvencies in the construction sector in 2019 in England and Wales, 2,075 (63.0%) of these operated in the specialised construction activities industry (SIC 2007 division 43).

This publication includes the following data tables on employment in the industry (Tables 3.3a to 3.3c, 3.4a, 3.4b and 3.5 in the accompanying dataset).

Employment in the construction industry decreased in 2019 by 6.0% compared with 2018, now totalling approximately 1.28 million workers. This follows what was a steady increase in recent years, that slowed in 2018 before the fall in 2019. This is the first decrease in employment in the construction industry since it fell by 0.1% in 2014.

Figure 10 shows the concentration of construction employment as a percentage by region in Great Britain. The South East and London made up the largest proportion of construction employment in 2019, with 15.1% and 13.1% of all construction employment respectively, followed by the North West with 12.2%. The North East and Wales, on the other hand, made up only a small proportion of construction employment, with 3.6% and 4.0% respectively.

Figure 10: Despite seeing a decline in share of construction employment in 2019, the South East is the largest region of construction employment in Great Britain

Nomenclature of Territorial Units for Statistics (NUTS1) regions of Great Britain

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With regards to growth rates of construction employment, all constituent country regions experienced falls in 2019, with Wales decreasing by 4.1%, Scotland by 5.3% and England by 6.1%, giving Great Britain an overall decline in employment of 6.0%. All English regions apart from the North East, which grew by 5.6%, experienced falls. By far the biggest fall in construction jobs was 15.3% in the East of England, followed by decreases of 11.2% in London and 8.6% in Yorkshire and The Humber.

Data in Figure 10, as with Figure 5, relate to where individual firms are registered on the Office for National Statistics (ONS) Inter-Departmental Business Register (IDBR). Therefore, despite representing a good indicator of where construction firms employ people, construction firms may operate and employ workers across wider geographical areas, not just the region in which they are registered. Figure 5 shows the concentration of construction firms as a percentage by region in Great Britain, while Figure 10 shows the concentration of construction employment by region. In most cases, a higher number of firms in a region tends to mean a higher number of employees in that region.

The figures published in Figure 10 and Tables 3.3a, 3.3b and 3.3c do not account for self-employment within the construction industry. According to Self-employment jobs by industry (worksheet named “8. GB totals”) data published quarterly by the ONS, there was an average of 819,000 self-employed construction workers in Great Britain in 2019. This represents a decrease of 27,000 compared with 2018, with self-employment remaining concentrated in UK Standard Industrial Classification (SIC) 2007 divisions 41 and 43, the construction of buildings and specialised construction activities.

Despite the decrease seen, the construction sector continued to be the UK SIC 2007 section with the highest levels of self-employment.

Average weekly earnings

We produce data on average weekly earnings (AWE) in the economy as a whole and by sector on a monthly basis. AWE measures money paid per week, per employee in Great Britain in return for work done. The estimates are not a measure of pay rises as they do not adjust for changes in the structure of the workforce or the proportion of the workforce who work full- or part-time. This value is calculated before tax and other deductions from pay.

Figure 12 shows AWE by sector between 2015 and 2019. The whole economy has experienced steady wage growth across the period, with the financial services sector the highest earning sector. All of the sectors in Figure 12 showed growth across 2019 compared with 2018, with AWE for the whole economy increasing by 2.8% in December 2019 compared with December 2018. Of the sectors shown in Figure 12, construction saw the smallest annual wage growth increase in 2019 at 1.8%.

Figure 13 shows Construction Output Price Indices (OPI), by all work, new work, repair and maintenance. Construction prices have seen gradual increases since 2016 with a broad upward trend driven mostly by the increase in new work. This was also the case in 2019 with the all construction output price index showing strong growth in the first half of 2019, growing by 2.5% between January and July 2019, followed by a slight fall across the second half of 2019.

Despite the fall across the second half of 2019, the level of output price indices remained above levels seen in 2018. In comparison, repair and maintenance output prices remained broadly flat across the second half of 2019. The annual rate of inflation for all construction was 1.7% in December 2019, down from 2.8% in December 2018 and was the lowest December rate since 2014.

Annual growth rates for all three main construction OPIs have remained positive since September 2015, with the output price index for all construction peaking in July 2019 at 111.6.

Table 1 shows the annual rate of inflation for new work in the 12-month period to December 2019 was 1.8%, and 1.3% in repair and maintenance.

The growth in new work output prices was largely driven by sector price increases in infrastructure, which increased by 3.2% in the 12 months to December 2019, which was more than double percentage growth of any other sector.

Within repair and maintenance output prices, both housing and non-housing repair and maintenance saw price increases in the 12 months to December 2019, by 1.0% and 1.5% respectively.

Construction is a naturally volatile industry and is responsive to fluctuations in both consumer and business confidence as well as economic variables, such as interest and exchange rates. The construction industry accounted for approximately 6% of gross domestic product (GDP) in 2019 and influenced some of the main economic indicators including inflation and employment. This section will provide analysis on how the construction industry both compares and contributes to specific areas of the wider UK economy.

Price inflation

Figure 14 shows the comparison between the Consumer Prices Index including owner occupiers’ housing costs (CPIH), the Construction Output Price Indices (OPIs), all work implied deflator price indicator (IDEF) and the Services Producer Price Index (SPPI) from Quarter 1 (Jan to Mar) 2008 to Quarter 4 (Oct to Dec) 2019.

The Construction OPIs’ rate of annual inflation continued to be higher in 2019 than both the CPIH and SPPI. While the annual growth in the Construction OPIs fell to 2.2% in Quarter 4 2019, which was the slowest rate of annual growth since Quarter 2 (Apr to June) 2017, this is still stronger annual growth than in the CPIH (1.4%) and SPPI (1.5%) indices.

Productivity

Figure 15 shows labour productivity, measured by output per hour within the whole UK economy, broken down by broad industry groups between 2008 and 2019. Labour productivity, as measured by output per hour, grew more in percentage terms in the construction industry (6.3%) than any other data series as shown in Figure 15. In contrast, there was 0.2% productivity growth within the whole UK economy in 2019.

While whole-economy productivity was largely flat across 2019 compared with 2018, productivity growth varied between industries. Of those industries highlighted in Figure 15, while construction productivity continued to remain the lowest, productivity as measured by output per hour, increased the most in construction growing by 6.3% in Quarter 4 (Oct to Dec) 2019 compared with the previous quarter a year previous. In comparison, both the finance and insurance industry and the manufacturing sector saw decreases of 1.1% and 0.8% respectively in Quarter 4 2019 compared with Quarter 4 2018.

Figure 16 shows a breakdown at a divisional level of construction output per hour in current prices, seasonally adjusted, for the UK between 2008 and 2019.

Please note that while Figure 16 uses current price values, Figure 15 uses a chained volume measure, and as such they are not directly comparable.

Civil engineering (UK Standard Industrial Classification (SIC) 2007 division 42) is the most productive construction industry as measured by output per hour, and saw a sharp increase in productivity in 2019, growing by 23.8% by increasing from £42.05 in Quarter 4 2018 to £52.07 in Quarter 4 2019.

Productivity increased in the specialised construction activities (UK SIC 2007 division 43) industry while it remained broadly flat in construction of buildings (UK SIC 2007 division 41).

The Office for National Statistics (ONS) publishes monthly data on the value of construction work in the housing sector as well as quarterly data on the value of housing new orders and investment in dwellings. In addition, the Ministry of Housing, Communities and Local Government (MHCLG) provide a range of data statistics relating housing.

Figure 17 shows the most recent ONS data for the number of permanent new build dwelling completions for each country in the UK, with 2019 data for Scotland not yet published. We plan to next publish data in February 2021.

The number of permanent new build dwellings completions increased by 8.8% to 178,800 in England in 2019 compared with 2018, and by 4.3% to 6,070 in Wales. In comparison, completions fell by 2.6% in Northern Ireland to 7,440, a slowdown following the increase of 11.0% in 2018.

Figure 18 shows the most recent ONS data for the number of permanent new build dwelling completions in England, by tenure. Private enterprises contributed most permanent new build completions in 2019, with more than 80% of all completions.

The 8.8% (14,410) growth in the number of completions in England in 2019 was driven by private enterprises, which increased by 7.6% (10,270) and housing associations, which increased by 16.9% (4,630). In comparison, local authority dwelling completions saw a 18.6% (490) year-on-year decrease in 2019, though these make up a small proportion of overall completions and are comparatively more volatile.

Data on both the prices and quantities of building materials used, bought and sold in the UK are published by the Department for Business, Energy and Industrial Strategy (BEIS) in the monthly statistics of building materials and components. BEIS also publishes information on trade in construction building materials using data from HM Revenue and Customs (HMRC). The data cover three main components: all raw materials, all semi-manufactures, and all products and components.

The UK operates a trade deficit for construction building materials and components. This means we import more construction materials and components than we export. Figure 19 shows the trade deficit in construction materials and components was £10,421 million in 2019.

The deficit has widened since 2014, driven by an increasing value of imports of building materials and components, until 2019, where the deficit reduced by £153 million as exports increased. The rate of annual growth of the deficit slowed from 15.0% growth in 2016 to 9.2% in 2017 and 6.5% in 2018, and then fell by 1.4% in 2019.

Figure 20 shows the EU and non-EU balance of trade in construction materials and components, showing that a decrease in the trade deficit with EU countries drove the decrease in the overall UK trade deficit in construction materials in 2019. In comparison, the trade deficit with non-EU countries increased by 12.2% in 2019.

Table 2 shows the top five export and import markets for the UK in 2019. The top five export markets accounted for 51% of total construction materials exports in 2019, with the Republic of Ireland the largest single export market, accounting for 16% of all exports of UK construction materials. The top five import markets accounted for 46% of total construction materials imports in 2019, with China the single largest source of imports with 18%. Four of the top five UK export and import markets for construction materials in 2019 were European countries.

Figure 21 shows a quarterly volume growth index of construction from 2015 to 2019 for the UK, Germany, France, Italy, Spain as well as the European Union (EU-28), which are the 28 members of the EU.

It is worth noting that this data series covers both new work, and repair and maintenance output, whereas Table 2.4 covers only new work output.

Since 2015, the EU-28, Germany and the UK have seen sustained year-on-year growth in the construction industry. From Quarter 4 (Oct to Dec) 2015 to Quarter 4 2019, the level of construction increased by 13.0% in Germany, followed by 12.2% in the UK. In the case of the UK, however, most of UK construction output growth was from 2015 to 2017, with the level of construction broadly flat from 2018 to 2019.

Figure 22 shows Organisation for Economic Co-operation and Development (OECD) volume production in construction data for the EU-19, the 19 EU countries which use the Euro, and selected other countries from 2015 to 2019. The level of construction output across 2019 was broadly flat in the UK and has been since 2017. Similarly, the level of output in 2019 was flat in New Zealand, Australia, Canada as well as the EU-19. In comparison, the level of construction output in the United States saw strong growth across 2019.

External data sources and previously published tables

This publication previously included the following statistics, now published externally:

• Annual Business Survey (employment size and growth)
• Department for Communities (Northern Ireland): Housing Statistics
• Construction output statistics (Northern Ireland)
• Insolvency Services Official Statistics
• Planning applications statistics
• Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR)
• the Construction Industry Training Board (CITB)

Other related data published by the Office for National Statistics:

• Employees and self-employed by industry
• Stoppages of work
• Workforce jobs by industry

Construction statistics: sources and outputs also provides further links to construction-related data sources.

In addition, the recently published Migrant labour force within the UK’s construction industry article offers further data on the age, country of origin and birthplace of the construction workforce. While not covering 2018, it provides a detailed overview of the UK construction workforce between 2014 and 2016.

As of 5 September 2019, the Office for National Statistics (ONS) is publishing regional GDP estimates on a quarterly basis at the NUTS1 level, which include construction data.

Construction output estimates

Construction output estimates are monthly estimates of the amount of output chargeable to customers for building and civil engineering work done in the relevant period, excluding Value Added Tax (VAT) and payments to subcontractors.

Seasonally adjusted estimates

Seasonally adjusted estimates are derived by estimating and removing calendar effects (for example, leap years such as this year) and seasonal effects (for example, decreased activity at Christmas because of site shutdowns) from the non-seasonally adjusted estimates.

Value estimates

The value estimates reflect the total value of work that businesses have completed over a reference month. Value estimates are also referred to as the data in current prices.

Volume estimates

The volume estimates are calculated by taking the value estimates and adjusting to remove the impact of price changes. Where chain-linking is applied volume estimates are referred to as chained volume measures.

Construction statistics annual

The construction statistics annual publication brings together a wide range of statistics currently available on the construction industry from a variety of sources. Data from the Office for National Statistics (ONS) as well as other government departments are used to provide an overview and analysis of the construction industry as a whole.

The construction industry is categorised as section F of the UK Standard Industrial Classification (SIC) 2007, specifically SIC divisions 41, 42 and 43, which are defined as:

• 41: Construction of buildings
• 42: Civil engineering
• 43: Specialised construction activities

This edition of the Great Britain construction output statistics, which analyses the calendar year of 2019, includes updated figures in Tables 2.4, 2.5, 2.6, 2.8, 2.9, 3.1, 3.3, 3.4 and 3.5, which were included in the previous Construction statistics annual tables. Following feedback from data users, this edition again contains Table 3.6, which further breaks down the number of construction firms by turnover size-band. It is worth noting that all data published in this release are in current prices and, unless otherwise stated, non-seasonally adjusted. All data are correct at the time of release, however, are subject to revisions as per the respective revisions policy.

This release also marks the third annual publication in which Value Added Tax (VAT) data have been used to estimate construction output. VAT data have been incorporated from 2016 onwards in Tables 2.4, 2.8 and 2.9.

All other tables that were previously contained in the annual construction statistics publication are no longer collated and published by the ONS. Where these data tables are no longer published, links have been provided in Section 11 of this publication to enable users to obtain the relevant data from external sources.

All data in the release are correct as of time of publication. Please note that because of the various revisions policies of the statistics used in this publication, some data may change in subsequent releases.

Quality and Methodology Information

As this publication uses a variety of different data sources the following provide links to Quality and Methodology Information (QMI) reports for the respective data sources. Where a QMI is not available, a link to a page which describes the overall methodology is provided.

These QMI reports contain information on the strengths and limitations of the data and how they compare with related data, the uses and users of the data, how the output was created and the quality of the output including the accuracy of the data.

• Construction output QMI
• New orders in construction QMI
• UK business; activity, size and location QMI
• Business demography QMI
• Monthly insolvencies QMI
• A guide to sources of data on income and earnings
• Construction Output Price Indices QMI
• Productivity QMI
• UK house building data
• Building materials and components: monthly statistics