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Construction Trade Survey indicates increase in activity but highlights skills concerns

World Cement,

The ‘Construction Trade Survey’ for the UK in 4Q14 has been released, revealing that growth has been sustained for a seventh consecutive quarter. Companies across the construction sector reported an increase in output during the quarter and anticipated continued growth in 2015. This includes large contractors, SMEs, product manufacturers and civil engineers. Some of the key findings from the ‘Construction Trade Survey’ are detailed below.

  • On balance, 44% of building contractors saw a rise in output compared to 4Q13.
  • More than half of building contractors reported a rise in private housing output in 4Q14.
  • 12% of contractors said they had experienced an increase in private housing orders during the quarter.
  • Some 11% of building contractors reported a decline in housing repair and maintenance.
  • According to 16% of building contractors, public non-housing orders (education and health) improved in 4Q14.
  • Private commercial output was up on the corresponding quarter in 2014 according to 40% of building contractors. Meanwhile, 9% of contractors reported a rise in orders in the private commercial sector.
  • When comparing 4Q14 to 3Q14, 57% of companies reported an increase in labour costs and 68% said that materials costs had risen.
  • Around 70% of building contractors experienced difficulty in recruiting bricklayers, up on the 41% who reported difficulties in 3Q14.

“Looking forward, contractors expect continued strength in private housing and commercial this year, boosted by public non-housing as a stream of work on the Priority School Building Programme gets underway. Outside of these sectors, however, order books weakened in 4Q, suggesting a moderation in growth in 2015. SMEs in particular reported a noticeable slowdown in new enquiries in 4Q,” said Dr Noble Francis, Economics Director at the Construction Products Association. “In addition, only product manufacturers felt the effects of falling oil prices in 4Q. Contractors, SMEs and civil engineers continued to report elevated costs, which implies any gains from a wider slowdown in inflation are yet to filter down the supply chain.”

Stephen Ratcliffe, Director of the UK Contractors Group (UKCG), added: “Recovery in construction is good news for everyone in the industry. Hopefully, possible political changes in the UK and economic uncertainty in the Eurozone will not damage the industry’s growth prospects. Cost pressures continue to be a worry largely reflecting skills shortages. That is why UKCG members are focusing their activities on attracting new people into construction.”

Adapted from press release by

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