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Infrastructure Construction Contracts up in March

According to recently released figures, infrastructure and construction contracts attained unprecedented levels last March, reaching £1.6 billion in total value.

The number of infrastructure construction contracts went up by 90 percent compared to the year before. Industrial construction contacts also increased by 104.7 percent, representing a major growth surge.

Economists predict that the combined strength of these two sectors will provide support to the continued growth of the construction industry.

The growing number of industrial and infrastructure works will create a needed diversion from the current focus on private housing.

The Government’s investment in road infrastructure is finally happening, as evidenced by the award of two major contracts in March: the M4 Corridor project around Newport and the Dunstable A5-M1 Link. These two projects have a collective value of £967 million.

The industrial sector also showed a solid performance, with March contract values valued at £627 million, which is a 104.7 percent increase over the totals reported in March 2014.

Rising demand for manufacturing and warehousing has driven the increase in industrial activity, with the North West receiving £70 million worth of contracts for a BAE Logistics facility in Barrow-in-Furness and Project Perch at Wirral Waters. 36 percent of all contract types awarded in March were for warehouse and storage projects.

The £1.633 billion value of the contracts awarded in both sectors represents an important boost to the construction sector, whose activity levels receded during the first quarter of this year.

Specialists in Construction Insurance

Barbour ABI lead economist Michael Dall said that to date, the construction sector’s growth has been spurred by private housing contracts, but there is a considerable risk of stalling if balance is not restored across several industries.

Mr Dall explained that the jump in both infrastructure and industrial activity is not good news just for construction, but for the UK economy as a whole, which is now benefiting from an improved investment range.

The report also noted that macro-economic growth is surpassing figures that were forecast in the 2015 and the latest Autumn Statement.

Mr Dall added that month-to-month results aside, the industry is improving and the Barbour ABI data demonstrates that construction is doing well. As the second quarter commences, pre-recession levels look set to return by 2017.

These latest figures come from Barbour ABI’s Economic & Construction Market Review, which is put together monthly to offer important insight into the performance of the country’s construction industry.

The report is put together using Barbour ABI’s construction data for every planning application in the UK, the Office for National Statistics’ Construction New Orders data, and other key indicators.

Barbour ABI is a recognised provider of construction intelligence services. A full-time lead economist and research specialist team work together to produce commercially important sights and analyse developments and trends within the building and construction industry.

Barbour ABI is also the chosen provider of Construction New Orders information to the ONS and the Construction and Infrastructure Pipeline for the UK government.

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