The results of the Q4 2018 RICS Construction and Infrastructure Market Survey show a mixed picture, but there has been a slowdown in output growth across the UK.

During Q4 2018, growth in workloads within the commercial and industrial segments came to a standstill for the first time in six years. However, the activity across construction sectors varies with a net balance of 20% of contributors to the RICS survey reporting an increase in private housing workloads in the UK.  

Public sector workloads were mixed, but surveyors reported growth in housing with a net balance of 14% seeing an acceleration in public sector housing likely attributable to the £1bn in additional HRA borrowing that has come through. Public sector workloads shadowed the private sector with an 8% slowdown in public non-housing construction activity. Infrastructure activity remained steady with a net balance of 18% seeing a rise in workloads over the quarter.

Anecdotal evidence from respondents suggested that the housing market slowdown, coupled with ongoing policy ambiguity related to Brexit, is weighing on business investment decisions. When asked how business enquiries for new projects or contracts have fared in the past three months, 10% more respondents reported an increase rather than a decrease compared to 24% in Q3. Growth in repair and maintenance work remains modestly positive.

Within infrastructure, the pace of growth in output was particularly resilient in roads, rail and energy, with rail and energy experiencing the sharpest increase in two years.