THE VOICE OF THE INDUSTRY
NI’s resilient construction sector prepares for challenges ahead CEF NI SHARES FINDINGS FROM LATEST CONSTRUCTION SURVEY …
T he latest CEF Construction Survey reflects a local construction sector that remains busy in terms of current workloads – but also a sector where immediate-to-medium-term cost pressures prevail alongside a growing pessimism about market opportunities over the coming year. The survey, which collected data from NI- headquartered firms which have a collective annual turnover of approximately £2.5bn, covers the last six months of 2022 and reflects on many of the key challenges that contractors, civil engineers and homebuilders are currently facing. The main findings included: • Looking at 2022, 50% said their profit margins had worsened or significantly worsened in comparison to 2021. Over the same period, 20% had seen an improvement in profit margins. • 62% of respondents do not expect their annual turnover to increase in 2023. Indeed, some 43% are looking to consolidate their business over the coming 12 months – with 27% looking to increase profitability. • 67% of firms said they were either at full or almost full capacity. Only 7% currently had capacity for significant levels of new work. • Materials availability challenges have receded – 80% saying any issues are now manageable. • Inflationary issues remain – 63% of respondents said these were continuing to pose serious financial concerns and 85% said they expect material costs to continue to rise. • On existing public sector supports – since the introduction of PAN 01/21 in August 2021, at least £21.5 million has been paid out to firms on existing public sector contracts to help with inflationary pressures and materials delays. • On future public sector projects – 81% wanted to see alternative forms of contract, specifically two-stage tendering, brought in for public sector works such as new schools and healthcare facilities. • Only 13% of respondents see increased public and private sector opportunities in Northern Ireland in 2023. Some 60% see the local market
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