Orders grow, but Q4 poor

New construction orders were worth £47.9bn in value last year, according to the latest data from the Department of Trade & Industry. That represents an 8% boost over 2005’s figure.

This value growth was backed by a welcome 6% increase in volume.

Public housing and the private commercial sector were the undoubted bright spots of the year overall. The former grew 35% in value (to £2.7bn) and 33% in volume, while the latter was ahead 33% in value (to £17.5bn) and 35% in volume.

All of the private commercial subsectors, apart from entertainment, enjoyed healthy growth in 2006, particularly: schools/universities (35% to £2.2bn), health (111% to £2.7bn), offices (30% to £5.4bn) and agriculture/miscellaneous (91% to £1bn).

Private housing delivered 3% growth in value (to £13.4bn), but slipped 2% in volume.

Private industrial orders increased 5% in value to £3.8bn, backed by 3% volume growth. Of the two subsectors that count, factories dropped 5% in value to £1.9bn, but this was compensated for by a 16% boost in the value of orders for warehouses to £1.8bn.

2006 was a bad year for the other public sector, delivering an 8% decline in value to £6bn and a 9% fall in volume. The only positives to be drawn from this sector were: a 22% hike in value to £681m for offices; and an 18% jump in value for agriculture/ miscellaneous orders to £706m.

Infrastructure continued its disappointing run, collecting the wooden spoon with a 23% drop in value to £4.4bn, reinforced by a 27% slump in volume.

The only bright spot here was  electricity-related orders, which rose 10% in value to £635m.

Water-related orders slumped 56% to £508m, while roads-related orders fell 28% to £1.2bn.

The quarterly comparisons in all sectors make for sober reading: it might be expected for the fourth quarter to be worse than Q3 (all sectors were between 5% and 27% worse off), but compared with Q4 2005, some sectors showed significant negative variances. Public housing, infrastructure, other public and private industrial were all down in value  and volume compared with Q4 2005. Private commercial orders were static in value, but volume grew. Only private housing showed an increase in both value and volume.