NEW research has highlighted the opportunities available for Scotland’s construction industry as the sector continues its recovery from the Covid-19 pandemic.
Developers, contractors and public bodies say the majority of construction businesses will continue to positively rebound, in a report published by legal firm, Addleshaw Goddard.
Reimagining Scotland’s Construction Industry – 2021 and beyond is a continuation of the Addleshaw Goddard Scottish Business Monitor Report – produced in partnership with the University of Strathclyde’s Fraser of Allander Institute – which highlighted ‘significant growth in activity and sentiment’ within the construction industry earlier this year.
The survey, conducted with 43 firms in the sector, found that in the six months ahead respondents were generally positive about their expectations across several indicators, including turnover and employment levels.
On average, firms expected to operate between 76-99% of normal capacity, with only 10% of businesses expected to fall below 50% of normal capacity. Only 6% of businesses revealed it was unlikely they would survive over the next six months, with 82% reporting that it was somewhat or very likely that they would survive.
74% of businesses reported their cashflow positions were secure or very secure, while 42% of respondents said the level of government support has been sufficient or very sufficient. Some 34% of businesses said the level of government support was somewhat or very insufficient for their survival.
The report also highlights the current procurement processes which Addleshaw Goddard said can have a negative impact on growth in construction, particularly in the public sector, given the weighting given to the cost of a job over the quality delivered.
Contributors to the report highlighted barriers to delivering a more modernised approach to construction because of the political uncertainty surrounding Scottish independence and its future relationship with Europe.
The report did, however, underline that Scotland has got the tools to modernise construction techniques and processes, deliver more cost and carbon efficient buildings and infrastructure and support a more diverse industry full of green jobs.
Anne Struckmeier, construction and engineering partner at Addleshaw Goddard, said, “Scotland’s construction sector has endured a turbulent 12 months as a result of the Covid-19 pandemic which forced the Scottish Government to request the complete closure of the vast majority of construction sites throughout the first lockdown. This had a detrimental impact on the industry nationwide but collectively, the sector is now in a strong position to deliver a more modernised and sustainable approach. This is helped by the Scottish Government’s post-pandemic growth roadmap which is focused on investing in retrofitting existing stock in the built environment.
“Appetite from private and public sector clients tendering new projects is heavily geared towards supporting the push to meet national net zero targets, and this presents a golden opportunity for the sector to seize and drive forward a more sustainable agenda. Improvements, particularly around the use of data and tech, are still needed. However, despite this, the report highlights that the industry seems cautiously optimistic that the rising tide of awareness on environmental, social and governance considerations has the potential to trigger the construction sector’s own green industrial revolution, which is an exciting position to be in.”
