Audit firm KPMG has raised doubts as to whether the construction industry can deliver on the “tidal wave of work” it is set to be engulfed in.
Today’s (2nd July) release of the CIPS/ Markit PMI data pointed to a growth in construction output in June and a surge in business growth.
With just under two-thirds of the survey panel (62%) forecast a rise in output over the next 12 months, Richard Threlfall, head of infrastructure, building and construction at KPMG UK, is concerned the industry will not be able to deliver on the growing demands.
Threlfall said: “Today’s figures confirm the acceleration in demand for UK construction. The industry will soon be running white hot, as housing, commercial and infrastructure demand are rising together.
“What we are seeing is very unusual. Private demand is rocketing in response to an improving economy and much stronger business confidence. And public demand is surging too, following the Government’s post-election re-commitment to a huge infrastructure investment programme.
“The critical question is, can the industry deliver? I am concerned it cannot. The industry is about to be engulfed in a tidal wave of work but it’s struggling already with a huge skills shortage, weak Tier 1 balance sheets, and a lack of investment in capacity. I expect a lot more industry trauma as this story plays out.”