2017 brings reason to be confident
D-Drill managing director Julie White says today live on BBC News that construction companies are still cautious going into 2017 – at a time when they should be full of confidence.
The latest Markit/CIPS UK Construction PMI showed that business activity in the sector had risen at the fastest rate since March and that commercial work had picked up for the first time in six months. (https://www.markiteconomics.com/Survey/PressRelease.mvc/b160c9678d9c4eaeaa36fea2da5ef7af )
But Julie says a shortage in skills, a rise in material costs and general uncertainty have left many in construction feeling unsure of what 2017 will bring as business optimism dropped to its lowest since the middle of 2013.
Julie said: “It’s a strong end to the year and means the construction sector continues to show resilience in a tough and uncertain economic climate.
“The residential sector and the commercial sector have performed well over recent months – with some companies saying work has resumed following the referendum vote.
“However, the rising costs and the deep uncertainty around Brexit and what it will mean to the UK mean confidence is at a three year low.
“With the statistics as they are and with the potential for the three Hs – Hinkley, HS2 and Heathrow – this should be a time when construction is full of confidence but instead, companies are still cautious.
“There is also still a skills shortage in the industry which prevented many firms from bidding for work this year.
“So it’s a very unclear picture at the moment and that reflects the national mood. All the ingredients are there for this to be a boom time for construction – we need more houses, more commercial space, better infrastructure – but the uncertainty is weighing heavily on confidence among companies.
“I believe we can be confident going into 2017 but I think for everyone’s sake, the Government needs to show how it is going to deal with Brexit to give everyone clarity and to ensure investment remains on track.”