RICS construction market survey – third quarter 2001

Citation

(2002), "RICS construction market survey – third quarter 2001", Property Management, Vol. 20 No. 1. https://doi.org/10.1108/pm.2002.11320aab.014

RICS construction market survey – third quarter 2001

RICS construction market survey – third quarter 2001

An RICS construction industry report published in October, shows the knock-on effect of the slowdown in manufacturing penetrating deeper.

Overall, workloads rose for the 22 quarter in a row but the rate of growth has been slowing steadily and is levelling off. The number of chartered surveyors reporting a rise in total workloads in the third quarter over a fall, has slipped to 15 per cent from 17 per cent in the second quarter. This is the weakest figure since the third quarter of 1999 when the economy successfully fought off a sharp slowdown in the wake of the 1998 emerging markets crisis.

The RICS construction market survey looks at the workload of chartered surveyors working in the building industry. They are among the first to detect new trends in construction because of their early involvement in projects. Construction growth is an excellent economic indicator as the sector is extremely susceptible to economic uncertainty.

A third quarter dip in demand coupled with increasing anxiety about the global economic outlook had already muted confidence before the terrorist attack of September 11 in New York.

Confidence is shored up in the short term by a steady stream of public sector contracts. However, looking further down the line it has markedly depleted as the outlook for the wider economy is increasingly gloomy. A total of 26 per cent more chartered surveyors expect a rise in construction workloads in the next quarter than expect a fall, but only 2 per cent expect this to continue into the next year. Profit margin expectations over the next 12 moths have likewise fallen sharply.

Skilled labour availability continues to worry 47 per cent of chartered surveyors, up from 45 per cent in the previous quarter, one Glasgow surveyor reporting squads of brickies being "imported" from Inverness.

Regionally, London and the South East experienced a slight rebound in workloads, where 19 per cent more surveyors reported a rise than a fall, up from 15 per cent in the second quarter. Wales has been a relative hive of activity with 26 per cent more surveyors reporting a rise in workloads than reporting a fall, up from 4 per cent in the second quarter 2001. Elsewhere the story of slowing growth is maintained.