Increased spending on infrastructure drove a 7% increase in the value of construction work in Scotland in the third quarter of this year.
Official figures released yesterday show the value of all Scottish construction work in Q3 was £2.64billion, compared with £2.47billion in the same period last year. This was up nearly £700million on the previous quarter.
The data from the Office for National Statistics revealed that the value of new orders in the quarter increased by nearly 42% to £1.7billion, from £1.2billion during the same period in 2012.
Howard Archer, chief economist at IHS Global Insight, said the marked rise in construction orders supported hopes the sector would help the economy see further decent GDP growth in Q4 and beyond.
The biggest rise in new orders was seen in infrastructure work, which jumped nearly 179% to £761million , while private sector housing orders rose 27% to £196million in Scotland.
The figures revealed a 40% drop in public sector housing orders to £50million. Orders for all other work fell across the board.
“There are continued signs of improving prospects for the industry and a sense of cautious optimism about the outlook for 2014,” Scottish Building Federation managing director Vaughan Hart said yesterday.
“At the same time, levels of output from key sectors of the industry such as private sector house-building and commercial construction remain significantly below where they were five years ago. That suggests that recovery in construction and across the wider economy remains fragile.”
He said industry capacity had reduced significantly during the recession, which could restrict future growth within the building sector and drive up prices.
Housebuilder Bellway yesterday said it continued to see strong customer demand for new homes with 31% of orders coming from buyers using the government’s Help to Buy mortgage scheme.