The body that represents the UK’s manufacturers and distributors of construction products and materials has issued an upbeat forecast for the sector.
The Construction Products Association’s Summer Forecasts, published on 4 August, suggest that the construction industry will grow by around ten per cent and contribute nearly £11 billion to the UK economy over the next two years alone. The forecasts predict that:
- construction output will grow 4.7 per cent this year and 4.8 per cent in 2015
- total construction output will rise 22.2 per cent over the next five years
- private housing starts are expected to grow by 18 per cent in 2014 and ten per cent next year
- commercial offices output is set to grow by 10 per cent in 2014 and eight per cent in 2015.
Dr Noble Francis, the association’s economics director, said: “We anticipate the recovery will continue through the forecast horizon in 2018 and broaden both across sectors and regions. Overall levels of activity will likely match their 2007 peak in 2017.
“In the short-term, the activity will primarily be led by private housing, infrastructure and commercial. Notably, in the long-term, we expect this activity will be boosted by work on schools and hospitals.
“The private housing sector continues to benefit from the improving economic backdrop and government policy measures. Commercial, the largest sector, has a greater influence than housing on the overall outlook for the construction industry and should contribute 23.4 per cent growth over the forecast horizon to 2018.
“The offices sub-sector is the primary driver in commercial, and recovery in the sector has been dominated so far by growth in London. Activity in regional markets is starting to pick up, however.
“During the last 18 months, increased demand and rising rents have been reported in key regional markets such as Manchester, Edinburgh and Birmingham which should feed through to new offices construction from 2015.”
The association’s forecasts provide further evidence of an upturn in the construction sector, leading to the potential for new opportunities and contracts for businesses in the industry.
Having access to expert legal advice from construction sector specialists can help to save time and money for business owners and managers when resolving both non-contentious and contentious issues.
Palmers can provide comprehensive advice and guidance to construction companies on all aspects of construction law, including advising on and drafting contracts, which can be a key factor in costly disputes. For more information, please contact Adam Davis.