Half as many construction projects were put on hold in February 2010 as 12 months earlier, new figures reveal.
Data from business intelligence unit Glenigan shows 387 projects were stopped in February 2010, compared with 723 in February 2009.
The Glenigan Index shows project starts in February 2010 were down by just 14.8 per cent compared with a year earlier. The value of the shelved jobs is also significantly lower than a year ago - a total of £1.5 billion going on hold this February, compared with £4bn in the same month a year earlier.
Glenigan economics director Allan Wilen said: “The figures confirm the decline in shelved projects seen over the preceding two months.”
In December 2009, the value of projects put on hold dropped to £1.2bn, the first time the figure had been below the £2bn mark since August 2008.
But the value of stalled projects re-starting decreased by 30 per cent in the three months to February against the previous three months.
Mr Wilen said: “While the number of projects being placed on hold is clearly falling, the immediate fate of existing shelved schemes is less clear.
“In particular, a pick up last autumn in the number of reactivated private housing projects appears to have lost
momentum. The value of shelved private housing schemes being reactivated dropped 40 per cent against the preceding three months.”
The private housing sector still accounted for more than a fifth of the reactivations. It was responsible for just 11 per cent of cancellations.
Meanwhile, fewer frozen projects were abandoned altogether during the three months to February, compared to the previous three months.
The only exception was the cancellation of commercial and office projects, which increased by 13 per cent.
However, the commercial sector also saw the biggest fall in projects being put on hold. This figure was down 74 per cent in the three months to February.
The industry is watching the recovery of the commercial sector closely to see if it can plug the gaps expected to be left when the next government slashes public capital spending programmes to reduce the national debt.
According to the Office for National Statistics, the commercial sector was the industry’s biggest in 2007, worth £17.5bn and responsible for 37.5 per cent of all new work that year.
But by 2009 it had fallen to £7.1bn, below housing, infrastructure and public non-infrastructure work and
responsible for just 21 per cent of work.
Mr Wilen added: “Conditions in the commercial property market have strengthened over the last six months, and Glenigan is forecasting a gradual recovery in office project starts during the second half of 2010.”