Construction output in Great Britain: February 2023

• Monthly construction output is estimated to have increased 2.4% in volume terms in February 2023; this follows a 1.7% fall in January 2023, with February 2023 being the highest monthly value in level terms (£15,558 million) since records began in January 2010.
• The increase in monthly construction output came from increases in both repair and maintenance (4.5%) and new work (1.1%) on the month.
• Anecdotal evidence suggested several reasons for the increase in February 2023; it was partially driven by a bounce back from the fall in January 2023, but also continued strength across repair and maintenance sectors; many firms also noted an improvement of weather in February, which allowed them to get more work done.
• At the sector level, eight out of the nine sectors saw a rise in February 2023, with the main contributors to the monthly increase seen in private housing repair and maintenance, and non-housing repair and maintenance, which increased 5.0% and 3.7%, respectively.
• Alongside the monthly increase, construction output saw an increase of 0.9% in the three months to February 2023; this is the sixth period of consecutive growth in the three-month-on-three-month series; the increase came solely from a rise in repair and maintenance (3.1%), as new work saw a decrease (0.5% fall).
• The main positive contributors to the increase in the three months to February 2023 were non-housing repair and maintenance (5.5%) and infrastructure new work (2.8%); with the main negative contributor being private new housing (4.4% fall), despite the increase on the month; anecdotal evidence suggested a general slowdown in housing across recent months.

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 2020) 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.

Volume estimates

The volume estimates are calculated by taking the value estimates and adjusting to remove the impact of price changes.

Quality and methodology

More quality and methodology information is available in our:

• Construction output QMI
• Construction output price indices (OPIs) QMI
• New orders in construction QMI

Reasons for revisions to construction output in this release

This release contains revisions to construction output estimates from January 2022 onwards, and is consistent with the National Accounts Revisions Policy. The revisions up to December 2022 are consistent with those published in our GDP quarterly national accounts, UK: October to December 2022 bulletin, published on 31 March 2023.

Revisions in this release are a result of:

• revisions in the nominal data; this includes revisions to both the survey data and Value Added Tax (VAT) turnover data
• this release now including VAT turnover data for the first time in Quarter 3 (July to Sept) 2022
• revisions to seasonal adjustment factors, which are re-estimated every month and reviewed annually
• revisions to the input series for the Construction Output Price Indices (OPIs)

For further information on the revisions profile, see our Output in the construction industry – revisions triangle (one-month growth) dataset and our Output in the construction industry – revisions triangle (three-month growth) dataset.

Sub-national and sub-sector construction output

Data on new orders supplied by Barbour ABI, as shown in our Quality assurance of administrative data used in construction statistics methodology, are used to model the breakdown of the overall output figures for Great Britain into the lower level and regional data, as shown in Tables 1 and 2 of our Output in the construction industry: sub-national and sub-sector dataset.

Bias adjustment

Typically, since the move to monthly gross domestic product (GDP) estimates, an adjustment to address any bias in survey responses for construction output is applied to the early construction output monthly estimates. This is shown in our Improvements to construction statistics: Addressing the bias in early estimates of construction output, June 2018 article.

Response rates for February 2023 are back at pre-coronavirus (COVID-19) pandemic levels. We have continued not to apply a bias adjustment for February 2023, but we will review this approach in the future.

Differences with Monthly GDP construction estimates

In Blue Book 2021, a new framework was introduced in our Producing an alternative approach to GDP using experimental double deflation estimates article. This improves how we produce volume estimates of GDP for balanced years as part of the supply use process. This framework included the implementation of double-deflated industry-level gross value added (GVA) for the first time. This improvement was reflected in the GDP quarterly national accounts, UK: April to June 2021 and GDP monthly estimate, UK: August 2021 for the first time.

As a result, volume estimates in the monthly GDP and construction outputs releases will differ for the period 1997 to 2020. This is because the construction publication measures the volume of construction work (output), while the GDP series measures GVA (that is, output minus intermediate consumption). Construction estimates will align, however, from January 2021 onwards on a growth basis.

Information and indicative effects of this change to industry-level GVA volume can be found in our Impact of double deflation on industry chain volume measure annual estimates article and our Impact of Blue Book 2021 changes on quarterly volume estimates of gross domestic product by industry article.