Construction growth is far less than it was thought to be a month ago, according to the latest official statistics.
And that means UK plc growth was probably slower that we thought too.
The latest figures suggest that output growth for construction in the second quarter of this year was about 6.8% and not the 9.6% previous penned in.
Meanwhile second quarter growth came in at 4%, which was more or less in line with the estimate for UK construction penned into the latest gross domestic product figures.
The net result is that the construction industry is about £1.1 billion or so smaller than we thought it was a month ago
This will provide some mental easing among the industry’s number crunchers and dipstick wielders, who had raised a torrent of queries about the ONS estimates in the GDP figures that put construction growth at almost 14% for the first half of the year.
Some of these have been discussed in earlier blogs.
The current set of figures, while higher than many in the industry would comfortably accept as accurate, will probably be seen by most as within a range of what is believable given the complexities of actually measuring construction output.
The dotted blue line in the graph shows where quarterly output probably would have been now had there not been the revisions.
But the consequences of these revisions will be interesting to witness when we see the next revisions to the GDP figures.
I couldn’t help but be amused yesterday when I receive a note from one economics consultancy to say that there was little in the way of important data out today relating to the UK. I, and a few others I suspect, had a sneaking suspicion that this set of construction output figures might be of some national interest.
All things being equal the revision in the construction statistics could mean cutting the official estimate of GDP by almost 0.1% (given the £1.1 billion or so shrinkage in GB construction output) and reducing GDP growth in second quarter growth from 1.2% to 1%.
Not that things are that simple. But for those who were dining out on the exceptional growth being enjoyed by the UK economy, the meal just has lost a little of its flavour.