Construction industry recovering from September 11, RICS report reveals

The UK construction industry is shrugging off fears of recession as its rebound from the post September 11 dip continues, according to the RICS report for the second quarter.

In contrast to gloom in manufacturing and turmoil on the financial markets, construction is holding firm. In quarter two, 21% more surveyors reported a rise in workloads than a fall, up from 14% in quarter one.

Much of this growth has been generated by the private housing sector. Rapid house price rises over the past year and a general shortage of housing stock have prompted house builders to increase their output of new homes.

A third more surveyors reported a rise in the private housing sector than reported a fall. This is accompanied by an unspectacular but steady 11% in public works, underpinned by increased public spending in health and education.

Growth in workloads was strongest in the north where a balance of 31% of surveyors reported a rise. However workloads rose generally at a slower pace than quarter one, particularly in Scotland, while continuing to fall in Northern Ireland.

Expectations for employment, profit margins and output remain largely unchanged, with many expecting the upturn to level out over the next 12 months.

Bricklayers are again in short demand, with 56% of surveyors reporting recruitment difficulties, although skills shortages eased slightly across other trades.