Private sector sets pace in construction recovery – RICS survey

THE private housing sector is driving a construction industry revival, although skills shortages threaten the pace of recovery throughout the Midlands, according to the RICS Construction Market Survey for Q1 2014.

The speed at which confidence is returning to the market in the Midlands is revealed by the fastest rate of growth in workloads since the construction market survey began in 1994,with improvement being driven by the private sector and, in particular, the commercial housing sector over the next 12 months.

However, the ‘feel good factor’ is being tempered by a further increase in reported skills shortages across many trades across the region. Furthermore, the Midlands picture shows 43% of respondents believe there are insufficient numbers of quantity surveyors currently available to meet rising supply demands for their services. 

Despite this, the continuing recovery in output in the sector will see further job gains with respondents in the Midlands forecasting an 11% growth in the employment footprint compared to last year – an additional 62,000 new employees being recruited into the construction industry nationally.

Adrian Aston, director at Wakemans and RICS Midlands construction spokesperson, said: “There is much more confidence in the private sector although activity is still restricted to certain sectors. 

“The hotel sector is still strong but food retail is slowing with more operators choosing to refurbish smaller convenience stores rather than build new larger outlets. 

“Developers should also be aware that the upturn also brings rising construction costs alongside skills shortages as the industry gears up for the increased levels of activity.”