LONDON British construction output grew more in the last three months of 2012 than first thought, pointing to a very minor boost to overall economic output, but there was an unusually sharp drop in activity in December.
Big falls in construction output were a major factor behind Britain's recession in late 2011 and the first half of 2012, and the country slipped back into contraction in the last three months of 2012, raising fears of renewed recession.
Construction output rose 0.9 percent in the fourth quarter of 2012, the first increase since the second quarter of 2011 and faster than the 0.3 percent rise assumed in preliminary gross domestic product calculations, the Office for National Statistics said on Friday.
Other things being equal, this revision could shave 0.04 percentage points off the preliminary 0.3 percent decline in fourth-quarter GDP reported last month, the ONS said. Revised GDP figures are due on February 27.
However, there was less encouraging news from non-seasonally adjusted construction output figures for December released at the same time.
These showed a 16.2 percent decline on the month and a 15.1 percent decline on the year in construction output - bigger falls than would normally be expected in a December, and the largest drops since the series started in 2010, the ONS said.
Part of the fall was explained by firms bringing forward construction work that would have been done in December to October and November, an ONS statistician added.
These figures tally with gloomy private sector surveys in December, and prospects for 2013 are not much better. According to a monthly purchasing managers' index, activity declined in January at the same pace as December, which saw the biggest drop since June.
Britain's economy emerged from recession in the third quarter of 2012, in part due to the London Olympics, but slipped back into contraction in the fourth quarter, due to ongoing falls in oil and gas extraction and the end of the Olympic boost.
Construction makes up 6.8 percent of Britain's economy, and output in the fourth quarter of 2012 was 9.3 percent down on a year earlier.
(Reporting by David Milliken and William Schomberg)