Positive horizons for the construction industry
Another year, another lockdown, but there are indicators that the construction industry is looking ahead.
Between a signed Brexit deal and the vaccine rollout getting firmly underway, there are opportunities, challenges and interesting times ahead for all industry’s, and construction is no exception. It even looks as though The White House might be in the market for few repair jobs sometime soon!
Optimism at a four-year high in the construction industry
In all seriousness though, there are rumblings of market growth. It has been reported that optimism among construction firms rose to its highest level in nearly four years in December, according to the latest CIPS/IHS Markit report.
According to the monthly purchasing managers’ index, the housebuilding sector was the fastest growing area of the construction industry, registering a score of 61.9, where any figure over 50 indicates growth in activity. Meanwhile commercial activity also grew, registering a score of 51.2. Improving client demand and a boost for workloads from new wins on projects deferred at the start of the covid-19 pandemic saw the growth in order books remain close to November’s six-year high, when new orders increased at the fastest rate since October 2014 – according to housingtoday.co.uk.
IHS Markit economics director Tim Moore said the sustained increase in activity showed a real recovery was under way, commenting in constructionnews.co.uk:
“Overall output growth has slowed in comparison to the catch-up phase last summer, but now it is encouraging to see the recovery driven by new projects and stronger underlying demand.”
Meanwhile, CIPS group director Duncan Brock was quoted as saying:
“With purchasing growth close to its highest for six years, supply chains were groaning at the seams and delivery times increased to the most dramatic extent for six months.”
Ensuring the best chance of positive outcomes on construction projects
Never ones for looking on the downside, this is the kind of positive outlook we have remained confident that the construction industry would be fast to produce at the earliest opportunity. However, with the potential for feast after famine, there must also be caution to observe due diligence like never before.
Emotions are not things that we tend to think about much in construction, but when they run high, they have the capacity to turn small disagreements into costly claims. As businesses seek to build and rebuild, emotions definitely have the capacity to run high. Ensuring strong and clear communication between parties, clear and organised document management, and having strong processes for conflict resolution in place are all central to positive outcomes.