Tag Archive for: construction

Construction Industry on the rise with positive results for the beginning of the year.

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The Federation of Master Builders (FMB) have published their quarterly State of Trade Survey for 2017. According to the FMB Chief Executive Brian Berry, the start to 2017 proved to be a positive one for the UK’s small to medium construction companies . 

Berry also commented that the first quarter of this year saw growing workloads in every devolved nation and English region, with particularly strong results in Wales, Scotland and Northern Ireland. Against a background of significant political uncertainty, including Brexit and the General Election, this demonstrates a resilience in our sector that can sometimes go underappreciated. All of the key metrics of growth – workloads, enquiries, employment and expectations – were positive. However, these encouraging findings are dampened somewhat by continuing price inflation, with material and wage increases being widely reported. The remainder of the year will undoubtedly provide its challenges, but in the short term at least, builders are confident about their prospects.

The key statistics were as follows:

Workloads grew markedly in every region and nation of the UK

85% of builders believe that material prices will rise in the next 3 months.

In the three months to March 2017, small to medium businesses workloads showed rising levels of activity. More firms reported higher workloads compared with the previous quarter (35% vs 32%), while fewer businesses reported lower workloads (14% vs 20%).

Over the next three months businesses are predicting an increase in activity levels. The share of respondents forecasting higher workloads went up to 50% from 26%. In contrast, firms anticipating lower workloads declined to just 5% from 21% during the latter part of 2016

Output prices, wages and salaries and material costs are all predicted to increase over the next six months

Approximately 14% of businesses stated higher workloads, up from 9%, while those reporting lower levels decreased to 9% from 26%. However, just over three quarters of firms (77%) stated no change in workloads.

Around 50% of businesses are forecasting higher residential workloads over the next three months, up from 26%, while just 5% of respondents anticipate lower workloads, down from 21%.

For non residential workloads, around 23% of businesses forecast higher workloads, up from 15%, while just 7% of firms expect lower workloads, down from 18%. Approximately 70% of the respondents forecast no change in workloads, up from 66% in the previous quarter.

Bricklayers were reported as being the most difficult to recruit in the first quarter of this year. Carpenters/joiners, site managers and plumbers and HVAC trades were also hard to come by. In contrast, fewer respondents had difficulties hiring scaffolders and floorers in comparison with other trades.

So, its a positive time for the construction industry with figures on the rise. Post Brexit construction is likely to have to find its feet, but with workloads increasing and customers not being put off by the Brexit unknown, construction can continue to grow and play an important part in our economy.

Brexit – what does it mean for the construction industry?

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The latest figures from the Royal Institution of Chartered Surveyors (RICS) show that eight per cent of the UK’s construction workers are EU nationals, accounting for some 176,500 people. Post Brexit, if the UK looses access to the single market, 176,500 jobs could be under threat which could jeopardise a predicted £500 billion infrastructure pipeline to a standstill. This must be addressed as a priority, according to RICS.

Jeremy Blackburn, head of UK Policy at RICS says that “as the industry’s professional body, we are working with government and industry to develop that skills base, building vital initiatives – such as degree apprenticeships – in our sector to drive the talent pipeline forward.”

The UK is already in the grip of a construction skills crisis. While some overseas professionals are regarded as critical by the UK Government, and are therefore prioritised during the visa application process, construction professions have not yet been added to the ‘UK Shortage Occupations List’. According to Blackburn, quantity surveyors should be included on that list. Some of the professions that are on the list won’t improve our infrastructure or solve the housing crisis, yet their skills are currently viewed as essential, whereas construction professionals are not.

RICS has cautioned that for Brexit to succeed, it is essential to secure continued access to the EU Single Market or to put alternative plans in place to safeguard the future of the property and construction sectors in the UK. Blackburn states that unless access to the single market is secured or alternative plans are put in place, we won’t be able to create the infrastructure needed to enable our cities to compete on a global stage. We have said before that this is a potential stumbling block for the Government, which is working to deliver both its Housing White Paper and Industrial Strategy. Of course, we must also address the need to deliver a construction and property industry that is resilient to future change and can withstand the impact of any future political or economic shocks — key to that will be growing the domestic skills base. As the industry’s professional body, we are working with Government and industry to develop that skills base, building vital initiatives, such as degree apprenticeships, in our sector to drive the talent pipeline forward. This survey reveals that more work needs to be done to promote the indisputable benefits of these schemes to industry — RICS intends to take this forward as a priority.

With Theresa May having officially triggered Article 50 on March 29th, Britain should officially leave the EU no later than April 2019. Last month, planning consultancy Arcadis said that the UK must hire more than 400,000 workers every year for the next five years to meet demand for house building and infrastructure projects, without the threat of foreign workers departing as a result of Brexit.

No member state has ever withdrawn from the EU, so these projections are just that at this stage. Whatever the future holds for construction, Broadsword will continue to use innovative and new approaches to deliver high quality work in all aspects of our business.