Bleak forecast for local construction firms
THE West Midlands construction industry will continue to face tough challenges in the year ahead, according to latest figures published today by the Construction Skills Network (CSN).
Growth in the region is not expected to return until 2013 but the longer term outlook is more positive with a slow but sustained period of recovery forecast.
The annual CSN report, produced by CITB-ConstructionSkills, the Sector Skills Council and Industry Training Board for the construction industry, shows that construction output in the West Midlands is expected to decline at an average annual rate of -1.1% over the next five years to 2016 – falling well below the national growth figure of 1.4%. This fall is compounded by the wait for large-scale construction projects in 2016, such as Birmingham’s Eastside district and the High Speed 2 rail link.
The public housing and public non-housing sectors are set to fare the worst in 2012, with continuing annual declines of -17.7% and -21.5% respectively. This sharp decrease in the public non-housing sector is a result of projects in the education and health sub-sectors coming to an end with little else in the pipeline for the area.
However, the outlook for the West Midlands is not entirely gloomy, with 3.8% growth predicted for industrial construction in the next five years and work beginning on the £350m Jaguar Land Rover engine plant near Wolverhampton.
The commercial construction market accounts for the largest share of new work, with 1.6% average yearly increase in the next two years. This has been helped by projects such as the £250m City Sentral shopping centre transformation in Stoke-on-Trent, which is due for completion in 2015.
Amanda Sergeant, CITB-ConstructionSkills’ sector strategy manager for the West Midlands, said: “The forecast for 2012 is a clear indication of the challenges we are still facing in the construction industry in the West Midlands. Times are tough and the effects are being felt particularly heavily by tradespeople and labourers.”
