Contractors are gearing up for the biggest year of growth since the recession hit as forecasters prepare to upgrade their expectations for industry growth.
The Construction Products Association, Experian and Leading Edge are next week expected to reveal the industry grew in 2013 after decline had been forecast over the course of last year, with stronger growth rates also expected for the following two years.
Construction Products Association economics director Noble Francis said upward revisions for last year would be largely due to significant revisions to output data from
the Office for National Statistics.
Quarterly growth rates for the second and third quarters of 2013 leapt to 2.6 per cent from 1.9 per cent and 1.7 per cent respectively.
“Unless Q4 2013 is disastrous, which we don’t anticipate it being, it would be hard to justify a negative for 2013,” he said.
Hopes for growth remain despite the UK’s battering by the worst storms in more than 20 years over Christmas and the New Year.
Aecom transportation director Paul McCormick said: “Most construction companies at the moment close down for two weeks over Christmas, and they are starting back with full workloads ahead of them.
“Overall I think the country coped remarkably well on what was a continued period of bad weather. Although it appears not to have delayed many construction projects, it will no doubt involve lots of construction professionals in clearing up and planning reactive and future mitigation schemes.”
Economists warned of some nervousness over post-election 2015, with growth forecasts for 2016 still positive but likely to be at a slower rate than the preceding two years.
Experian head of construction futures James Hastings said the likely scenario was for strong growth in 2014 and 2015, but there remained “real risks” that growth could be lower than expected should household income growth and productivity remain low and if the housing market struggled after the planned close of Help to Buy in 2016.
Private housing was highlighted as a sector core to maintaining sustained growth.
Glenigan economics director Allan Wilén said: “The crucial thing is whether by the time Help To Buy ends the sector will have gathered its own momentum so you can withdraw that support.
“If not, the government will have to do something, with a focus on new supply.” He was quick to stress the positive outlook overall. “If we see recovery in the wider economy, then we should see that transfer into private investment which is crucial for growth.”
Association for Consultancy and Engineering chief executive Nelson Ogunshakin said: “It is crucial that political parties of all colours consult with the industry on their plans for after the 2015 general election and the longer term.
“A return to ‘boom or bust funding’ will see uncertainty grow again, companies will become reluctant to invest once more, and the UK’s economic and social infrastructure will continue to stagnate.”