Citation
(2002), "Construction on solid foundation", Property Management, Vol. 20 No. 5. https://doi.org/10.1108/pm.2002.11320eab.002
Publisher
:Emerald Group Publishing Limited
Copyright © 2002, MCB UP Limited
Construction on solid foundation
Construction on solid foundation
The UK construction industry is shrugging off fears of recession as its rebound from the post-11 September dip continues, according to the RICS report for the second quarter published on 4 July 2002.
In contrast to gloom in manufacturing and turmoil on the financial markets, construction is holding firm. In quarter two 21 per cent more surveyors reported a rise in workloads than a fall, up from 14 per cent in quarter one.
Chartered surveyors are among the first to see ahead in construction because they become involved in projects at the proposal stage.
Much of this growth has been generated by the private housing sector. Rapid house price rises over the past year and a general shortage of housing stock have prompted house builders to increase their output of new homes. A total of 33 per cent more surveyors reported a rise in the private housing sector than reported a fall. This is accompanied by an unspectacular but steady 11 per cent in public works, underpinned by increased public spending in health and education.
The Chancellor, Gordon Brown, in his annual speech to the City of London referred to radical planning, housing and transport reforms to ensure that the South East can continue to grow and remain competitive with other successful areas of Europe. This included a commitment to "take seriously the case for further new housing development". Which will be taken as a signal that more business for housebuilders is on the way. However, this may lead to increased market volatility in the short term.
Growth in workloads was strongest in the North where a balance of 31 per cent of surveyors reported a rise. However, workloads rose generally at a slower pace than quarter one, particularly in Scotland, while continuing to fall in Northern Ireland.
Expectations for employment, profit margins and output remain largely unchanged, with many expecting the upturn to level out over the next 12 months.
Bricklayers are again in short demand, with 56 per cent of surveyors reporting recruitment difficulties, although skills shortages eased slightly across other trades.