Contractors confident of beating slump

A quarter of construction industry managers believe the UK economy will take a downturn in the next 12 months; but only 5% expect their business to follow suit.

The results of the Contract Journal/Grant Thornton Const-ruction Industry Survey 2003 show trading conditions are getting tougher.

Pressure on margins is now the main economic factor facing construction businesses, overtaking the scarcity of skilled labour, which was the biggest issue in 2001 and 2002.

Indeed the number of firms expecting to employ more staff in the next 12 months has fallen by 12%; the number planning to downsize is up by 60%.

Many contractors are "seeking refuge" in public sector work as commercial and industrial opportunities dwindle. Just 32% of respondents now have little or no reliance on government spending, down from 39% last year.