By Daniel Hunter

The Glenigan Construction Index for the three months to February fell by 15% compared to a year ago as private sector falls weakness dragged the index down for the second month of the year.

The fall in activity came from sectors that had previously boosted project starts at the end of last year; the largest decline was in the industrial sector, starts fell 56% compared to the same period last year. Private sector falls were contrasted by health and education starts, which saw new work increase by 21% and 7% respectively, pushing the level of starts above that seen in the preceding month.

"The poor start to the year continued in February and in stark contrast to what we saw in 2012 it is the private sector that leads the fall," Glenigan Economist Andrew Whiffin said.

"Starts were weak across the board but the industrial sector exerted the largest downward pressure on the index, starts 56% down on a year ago. Last year new work in the sector was driven by starts from the light industrial and warehousing subsectors, but so far this year starts in these two sectors have dropped away."

The health and education sectors helped cushion some of the fall in activity; education saw a number of new projects get underway this month with work focussed on refurbishment and extension of school properties. The health sector saw the largest gain in project starts this month and similar to what is happening in the education sector the source of this work was concentrated on refurbishment, extension and improvement.

"Despite government cutbacks public sector organisations do still have some resources available for capital spending. Industry activity has reflected this with increases in refurbishment and improvement work rather than building new, as organisations make the most of what is available," added Whiffin.

Join us on
Follow @freshbusiness