The recent Construction Index article “Data gatherers differ in their diagnoses” appears to have got some key data points confused.
What is clear is that firstly, there are a lot of statistics out there and secondly, construction is a very challenging beast to understand – not least when there are so many external factors at play in the wider economy.
Approvals are up but starts are down? Applications are down but contract awards are up? In such volatile times, it is possible to cherry-pick certain stats to suit any argument. However, at Barbour ABI we do our best to provide the fullest information overlaid with our views.
When we’re confident activity is up, we call it that way and vice versa. That’s why we’ve been giving the message for some months now that there’s no single trend at the moment pointing to a clear way forward. The ONS’ construction output has held up well over the first quarter of 2023 and there’s varying activity in planning. Some other leading indicators are very much in negative territory, especially around the residential sector, but some aren’t. And of course, we should be positive that, in uncertain conditions, there remains high underlying demand for construction.
In these challenging times, predicting the future is difficult. But, what doesn’t help, is mixing data sets incorrectly or using one sector as a proxy for the whole industry, as sector by sector performance varies dramatically. Our latest Snap Analysis puts the performance figures cited into the broader context and shows a different story to the one implied.