Declining output and orders on the demand side, combined with rising costs on the supply side characterised the UK construction industry in the last quarter of 2012.
That’s according to the latest Construction Trade Survey, from the Construction Products Association, published today (February 11).
Large firms, especially those working in the infrastructure sector, have seen some improving conditions, but the bulk of the industry still faces a very difficult year ahead especially those further down the supply chain, for whom slower workloads are being exacerbated by difficulties with late payments.
Noble Francis, CPA economics director said: “It was good to see a rise in construction output for Q4 compared to Q3, when activity was adversely affected due to the Olympics and Paralympics. However, output remains 9.3% lower than a year ago and this is reflected in the Construction Trade Survey.
“A minority of firms working on energy and rail projects continue to thrive as do construction product manufacturers who are able to export outside the EU. Yet, overall, the industry continues to suffer falls in work across both public and private sectors. Furthermore, outside of infrastructure, the industry is expecting that 2013 will be even more difficult, with declining orders and enquiries across the industry.”
Stephen Ratcliffe, Director UKCG, said: “Business conditions remain challenging and because construction is a lagging indicator there is unlikely to be any major improvement this year. Nevertheless, there remain good opportunities in infrastructure, in the schools programme and energy sector.
“‘Government support in providing guarantees to kick start stalled projects is welcome, as has been the announcement of PF2. UKCG continues to work with government to see what more could be done to speed up deal flow and increase work available to the industry.”
Key survey findings include: