Double-digit growth forecast for construction sector

Construction Products Association Summer forecast shows double-digit growth

 

Somewhat positive news being reported today by Construction Products Association with double-digit growth forecast despite the current issues surrounding building materials labour and driver shortages.

Key points:

Forecast to rise by 13.7% in 2021 and 6.3% in 2022

Key drivers contributing to construction growth include infrastructure and private housebuilding

House builders – Reporting of strong demand especially for houses outside major cities which is likely to remain so for the next 6-9 months.

Major projects – Hinkley Point C, the Thames Tideway tunnel and the High Speed 2 (HS2) rail project are central to strong output in the infrastructure sector

Commercial sector – Q1 of 2021 saw a rise in activity owing to fit-out work remodelling offices for staff to return in a socially distant manner. This was also the case in retail and leisure where refurbishing, reusing and repurposing helped prepare for reopening as social distancing restrictions eased

CPA Economics Director Noble Francis, said: “Whilst larger contractors and house builders have greater certainty in their pipelines of work and are better able to plan and purchase in advance, SMEs often purchase what they need on the day at builders merchants. This makes them subject to greater issues if supply is limited or costs have risen significantly, particularly for firms working on fixed price contracts.”

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