According to the latest survey of construction purchasers, there is an easing in cost inflation and continuing growth across the construction industry thanks to the private sector demand.
A UK construction companies report showed that both activity and employment levels are expanding at a strong pace. There are also signs that strains on raw material availability have started to subside, as highlighted by the slowest deterioration in vendor performance for just over three years.
The survey respondents noted that rising levels of supplier capacity, alongside lower fuel and energy costs, had helped restrain overall input price inflation in August.
The headline seasonally adjusted Markit/CIPS UK Construction Purchasing Managers’ Index (PMI) registered 57.3 in August, up from 57.1 in July and well above the neutral 50.0 threshold. Continue reading
According to research conducted by UK Construction Week in partnership with BRE, three quarters of construction professionals do not believe the industry is ready to meet mandatory BIM Level 2 requirements by 2016.
The research, which questioned more than 1,200 architects, contractors, developers, engineers and product manufacturers about their experiences of BIM, revealed a number of uncertainties throughout the industry.
In particular, the results uncovered a tension between the expectations of the specification community and the perceived demand for BIM-compliant products by manufacturers and suppliers.
Just over 74% of respondents think the industry will fall short of this target, which is due to come into effect for all procurement projects from central government and its agencies next year. Worryingly, a further 62% of respondents replied that they do not understand what is needed in order to meet the requirements of BIM Level 2.
The creation of accurate, complete and unambiguous information delivered from a single source is a fundamental principle of BIM. It is therefore somewhat ironic that the industry has to struggle with multiple sources and levelled information in order to ascertain the requirements for BIM Level 2. Continue reading
According to a report published by the Construction Products Association, construction output is forecast to grow 4.7% in 2014 and a further 4.8% in 2015, providing an additional £11 billion of activity to the UK economy in just two years.
The primary driver of growth in construction during 2013 was the £17.1 billion private housing sector. It is also the sector that has received the most effective intervention from policy makers. The direct impact of Help to Buy part one has been muted but the indirect impact on the housing market has been considerable.
Effective demand rose, through rises in mortgage lending, and private starts in Britain rose by 21.0% in 2013. Further growth of 18.0% in private starts is anticipated in 2014 with 10.0% growth in 2015 before post-election uncertainty regarding the future of Help to Buy Part One is reflected in more subdued growth.
Key Points Include:
- Construction output to grow 4.7% in 2014 and 4.8% in 2015
- Private housing starts to rise 18.0% in 2014 and 10.0% in 2015
- Commercial offices output to grow 10.0% in 2014 and 8.0% in 2015
- Industrial warehouses construction to rise 20.0% in 2014 and 10.0% in 2015
- Education construction to rise 2.2% in 2014 after three years of consecutive falls
- Health construction to fall, the sixth consecutive year of falls, due to lack of PFI work
Figures released on Monday by Glenigan, the construction intelligence providers, forecast a 7.4% increase in project starts during 2014, as rising private sector investment and improved consumer confidence underpin further industry growth.
According to the 2014 Mid-Year Construction Review and Forecast put together by Glenigan’s economics team, there is an indication that construction activity upturn is gathering momentum with growth estimated to be only 4% at the beginning of 2014 we are now seeing that the latest figures show a 7.4% increase.
A 10% rise in the value of projects was recorded by Glenigan starting on site during the first half of 2014, primarily driven by increases in private housing, industrial and commercial building projects.
Work volumes will continue to pick up across these sectors through the latter half of the year, with private housing set to rise by 14% and 28% growth predicted for industrial projects. The value of underlying office project starts is forecast to rise by 9%, building on the strong recovery seen over the last two years.
Commenting on the construction outlook, Allan Wilén, Economics Director at Glenigan, said:
“The industry’s forward pipeline points to sustained output growth during the second half of the year and into 2015. Renewed consumer confidence and the accompanying revival in the general housing market have emerged as key growth drivers for both construction activity and the wider economy.” Continue reading