THE latest Market Report from property and construction consultancy Gleeds suggests the UK Government is failing to instil widespread optimism amongst construction professionals, with less than half of those quizzed saying they feel positive about the future of the sector.
The figure shows a drop in confidence compared to the 70% who believed the industry was a priority for the Labour party when it was elected last year. In its manifesto, Labour pledged to ‘get Britain building again’ but Gleeds said progress has been ‘slow, and a lack of clear direction has left many feeling frustrated’.
Interest rates and inflation remain the biggest perceived threat to growth, followed by supply chain capacity, investor confidence, and the impact of global unrest. As insolvency figures begin to dip however, the report found just 15% of those questioned had been involved with a project impacted by company collapse over the quarter, despite the industry continuing to experience the highest number of businesses going bust in the year to July.
45% of respondents reported that they or a member of their supply chain had refused a tender in the previous three months, down from 80% this time last year. When asked about proposed legislation banning retentions and introducing fines for late payments, over a third said they believed such a move would further improve supply chain resiliency.
Brian McArdle, MD at Gleeds in the UK, said, “Our Market Report shows a fragile but gradually stabilising picture of construction under a Labour government. The sector continues to come under strain from insolvencies, inflation, and labour pressures, but opportunities do exist in public housing, healthcare, education, infrastructure and commercial – success will depend on converting government spending commitments in these areas into real project delivery, while safeguarding supply chain resilience.”
