Q2 workload improves, but fuel hikes create a problem

Construction output was up in the second quarter, but rising energy costs are driving up tender prices, with skills shortages adding to the headaches.

Civil engineering contractors are experiencing the strongest rise in workload in nine years and there has been a recovery in public sector work, according to the latest figures from the Const- ruction Products Association and the Construction Confederation.

Overall, four in 10 construction firms said output was up on a year ago. New public non-residential and both housing and non-housing repair and maintenance sectors were the star performers, and look set to continue this success.

But three-quarters of product manufacturers said they have increased prices over the last 12 months because of rising fuel and energy prices. Overall product sales were flat, with strong sales by light-side (finishing firms) being offset by weaker activity on the heavy or structural side of the industry.

[Contract Journal, 9 August 2006, p. 3]