Last edited 12 Feb 2020

Construction output

[edit] Introduction

Construction is an important indicator of how well the economy is performing, which is why construction output figures are used to compile the output aspects of gross domestic product (GDP).

UK construction output is a measure of the amount that has been charged to customers for building and civil engineering work carried out by construction companies in a specific period. This excludes Value Added Tax (VAT) and payments to subcontractors.

The value of the work involved is not a total of all work completed by construction companies in the UK. Rather, it is based on a sample of 8,000 businesses employing over 100 people or with an annual turnover of more than £60m. These estimates are extremely useful and are widely used by private and public sector bodies such as the Treasury, the Bank of England and others.

Measuring construction output is essentially a survey used to produce non-seasonally and seasonally-adjusted monthly, quarterly and annual estimates of output in the construction industry at current prices and at chained volume measures (removing the effect of changes in price).

VAT figures can also provide information about construction output, used to provide data for small- and medium-sized businesses. However, due to the delay in companies submitting their VAT invoices to Her Majesty’s Revenue and Customs (HMRC), such data is only taken on after a delay period. For example, VAT turnover data for a particular year may be used from figures that were compiled up to two years previously.

New orders are also important in gaining an insight into construction output. For these, the Office of National Statistics (ONS) collects data from the privately contracted Barbour ABI. The figures are used to model the breakdown of the overall output figures for Great Britain.

[edit] What is covered in construction output data?

The following types of work are covered when measuring national construction output, with the year being split into four quarters – Q1, Q2, Q3 and Q4.

Public housing
Private housing
Infrastructure (water, sewage, electricity, roads, railways, harbours etc).
Other public non-housing (factories, warehouses, oil, steel, coal, schools, colleges, universities, health, offices, entertainment, garages, shops, agriculture etc).
Private industrial (factories, warehouses, oil, steel, coal).
Private commercial (schools, universities, health, offices, entertainment, garages, shops, agriculture, miscellaneous).
Total new work
Information is also available on repair and maintenance across the regions.

The Office of National Statistics (ONS) presents the above data in two tables:

Table 1: Estimates for the type of work that has been undertaken, non-seasonally adjusted and at current prices at sub-sector (ie, regional) level and
Table 2: Construction output: value that is non-seasonally adjusted, with current prices at sub-national level.

The accuracy of the figures presented will be affected by changes in the value of orders since the figures were reported (eg, cancellations), and orders that did not convert into output within the timelines stated in the model.

Full can be seen at the ONS website.