RICS construction market survey

Citation

(1999), "RICS construction market survey", Property Management, Vol. 17 No. 1. https://doi.org/10.1108/pm.1999.11317aab.012

RICS construction market survey

RICS construction market survey

Keywords Construction, Statistics

The economic downturn is beginning to hamper Britain's construction industry, whose growth rate has slowed over the third quarter in 1998, says the Royal Institution of Chartered Surveyors (RICS), in its latest survey of the UK's construction industry. Although growth over the first six months of the year was firm, there is clear evidence that growing nervousness about the economy is inhibiting the development of new building projects.

The latest survey, of the three months to the end of September, reveals a drop in both current activity and future expectations. Total workload over the quarter declined by 0.5 per cent, giving construction an annual growth rate of 7.8per cent over the previous 12-month period.

The net balance of chartered surveyors expecting a drop in future workload is down to a three-year low of ­ 17 per cent for the coming year. However, the net balance for the coming three months remains positive, at +16 per cent.

Chartered surveyors practising in the building sector are among the first to detect new trends in construction because of their early involvement in new projects. The RICS Construction Market Survey looks at their future workload as an industry gauge.

Demand from the industrial sector is the weakest, with workload falling by 4.2per cent in the latest quarter. The commercial sector had its first decline ­ of 2.2per cent ­ for five years. Partly offsetting these falls, public works expanded by 2.1 per cent.

Despite the slowdown, short-term job prospects look good. While chartered surveyors have made downward adjustments in their expectation of employment growth, a majority still believe that the industry will take on more employees over the next 12 months. And skills shortages continue. Carpenters, bricklayers, plasterers and plumbers are all in short supply.

RICS construction industry spokesman, Chris Powell, adds:

This report on the whole reveals a slowdown in growth rather than actual decline, and it is good to see that most of our respondents still have full order books. Public and private investment combined with Lottery and Millennium spending will ensure that the industry will remain busy in spite of world economic turbulence and its inevitable impact on the domestic economy. The repair and maintenance sector is particularly strong.

However, construction cannot hope to remain immune from general economic slowdown, so the next few months and years may well be bumpy.