Construction sector shrinks for second month running

The Office for National Statistics found that the amount of new work being carried out in the period fell by 0.2%, while maintenance activity dropped by 0.5%.

The previous estimation of a 0.2% dip in performance in January was also revised down to 0.4%.

The figures reflect the first time the industry has shrunk for two months in a row since June 2015. However, the market is still 0.3% ahead for February 2016 as for the same month in the previous year.

The Bank of England’s Monetary Policy Committee earlier this week predicted that the Brexit vote had “begun to weigh on certain areas” like commercial property transactions.

In positive news for the sector, the ONS said that housebuilding had risen by 6.7% in the three months to February with the assistance of the Help to Buy scheme.

Andrew Bridges, managing director of Stirling Ackroyd, said that the demand for housing is there but “the doubts of planners are enforcing a dull and self-defeating march”.

“The final quarter of 2015 saw just 7,240 new homes granted approval in the capital – well behind the levels needed to house a soaring population,” said Bridges.

He added: “Londoners want to be able to live in London and this should be fuelling growth in the construction industry. But until borough planning departments begin to approve more homes and allow developers to get building, all these plans are on pause. We need true leadership from the next mayor – to get the scaffolds up, permissions granted and people in homes.”