Optimism and workloads rising in RICS Q1 construction survey
RICS says its survey of the UK construction market in Q1 2011 shows that workloads are rising again, after three quarters of decline, but that there are sharp differences between regions.
The headline net balance for total construction workloads increased from –4 to +5 for the quarter, as more surveyors reported rising than falling workloads. Those taking part in the survey said the main issues affecting construction activity are still a lack of finance and falling profit margins as costs rise and competition increases.
While activity is growing in London and the South East, workload levels are still deteriorating in Northern Ireland and Scotland. The net balance for the London and South East region rose from +6 to +24 in the quarter while the figure for Northern Ireland was –68 and for Scotland it was –10.
There is also a difference between sectors, with private housing (+8) and private commercial activity (+17) leading the recovery while public-sector works continued to decline during the first quarter – although the rate of decline was smaller, with the public-sector housing net balance at –10 (from –20) and other public-sector activity at –11 (from –20).
RICS says the survey has also provided evidence of growing optimism about the year ahead, with employment expectations turning positive this quarter, for the first time since Q1 2008. Workload expectations also turned positive in the quarter, but profit expectations remained negative with a net balance of –30.
