Business investment in the construction industry fell 5.3% last year, beating the UK average by a considerable margin, analysis of latest ONS data by business tax relief specialist Catax reveals.
Business investment in the construction sector declined £721m in 2020, dropping from £13.5bn in 2019 to £12.8bn.
This was significantly better than UK industry as a whole, which posted a 10.2% fall last year compared with 20192.
The sector also recorded a big slump in the final quarter of the year. Total business investment in Q4 2020 only reached £2.9bn, which was 45.2% (£2.4bn) down year on year.
UK GDP shrank considerably last year due to the consequences of the Covid crisis, declining 9.8% compared with 20193 — the worst annual performance on record.
Mark Tighe, CEO of business tax relief consultancy Catax, comments:“The construction sector went from looking like one of the most threatened industries in the face of the pandemic to a national example of what can be achieved through hard work.
“Behind this resilience though, business investment appears to have suffered greatly even as building has continued at pace. Shifting priorities for businesses trying to navigate a path through this crisis will be to blame but a renewed investment focus is inevitable as life returns to normal. If restrictions ease on schedule and the economy continues to battle its way back, normal levels of business investment should be regained by the end of the year.”