Last year saw construction industry output fall by an estimated 9%, making it the industry’s worse year since 2009, when output plunged 13.4%. In between there were a couple of growth years, but we’ve dipped back down again now.
Once you’ve fallen 13.4%, you need to grow by 16% the following year just to get back to where you started. Unfortunately growth was only 7.9%in 2010 and 2.8% in 2011. Even if the industry does return to trend-level growth, it will be 2021 before we reach pre-recession levels of output.
The 2012 Olympics and Crossrail show that UK Construction plc is capable of meeting any challenges thrown at it, and there are further ambitious major projects on the horizon to which we can look forward, such as HS2 and much-needed power stations. But how long can the industry afford to wait for these works to start?Nature abhors a vacuum. A construction industry sitting on its collective hands will struggle to maintain its peak fitness.
That the business environment will get tougher before it gets better is looking likely. What we need now is some leadership from big clients and major contractors to ensure that industry capability and capacity is maintained. Investment in training and R&D must continue, and the supply chain must be nurtured and protected. Subcontractors are not a piggy bank to be smashed with a hammer. They are members of the team. And good teamwork is needed now more than ever.
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