UK Construction industry forecast to grow between 2021 and 2025
The Coronavirus (COVID-19) pandemic has severely impacted the UK construction industry during 2020 and the beginning of 2021 with a sharp decline in confidence and output. The subsequent lockdown was one of the main factors in the UK construction industry output contracting by a reported 13.6% in real terms in 2020, Quarterly output told more of a concise story with output shrinking by 2.8% year on year in the final quarter of 2020. Earlier in 2020 declines of 8.8% in Q3, 35% in Q2 and 3.4% in Q1 2020 were recorded as output fluctuations followed the severity of the lockdown and work restrictions.
Research indicates that the country's construction industry will rebound strongly and grow by 8% in 2021 and record an average growth of 2.5% between 2022 and 2025 as pent-up demand and the resumption of large ongoing projects influences the figures.
The construction industry output is also set to benefit from investment in other capital projects such as major transport infrastructures, the growth in renewable energies and as a result of the new support package of £4.6 billion released in January 2021 by Chancellor Rishi Sunak. Confidence in the sector is also showing signs of improvements as the UK starts to exit lockdown under the government's confirmed exit roadmap.
Within the overall picture of the UK construction market, there are interesting submarkets which will help companies like ourselves plan our construction related products for the future. A recent report by Experian looked at the likely growth of subsections between 2021 and 2025 and concluded that looking in more detail and using the Bast-case estimates and the annual average growth rates for output over the five-year forecast, Public housing was set to grow by 8.2%, Private housing by 7.8% and Infrastructure by 5.5%. These were the top 3 sectors expected to grow strongly and be key drivers for recovery of the construction and wider economy.
Growth is evenly spread across all nations and regions of the UK, with both private and public housing being key sectors along with infrastructure projects in most regions. The UK’s average growth rate between 2021-2025 is estimated to be 5.4%, with England at 5.5%, Scotland at 4.5%, Northern Ireland at 5.2% and Wales at 4.8%.
This growth in the construction industry will have knock-on benefits for all those involved in supplying products and services into the sector. This Is no different for us here at BS Fixings as we sell a number of product ranges into the construction industry including tools, PPE, wall ties, signage fixings, sealants and a vast portfolio of nuts, bolts, screws, hooks, washers and stainless steel items.
This is keeping our product development and buying departments on their toes as we plan carefully our product offering over the coming weeks and months to support this growth.