CECA survey of SME civils firms: full results

A survey by the Civil Engineering Contractors Association suggests a bleak outlook for smaller contractors. The detailed findings are as follows:

• Banking. Across the UK 46% of SME civil engineering contractors have seen a rise in the cost of their banking arrangements as a result of the economic downturn, while 28% of firms have found it more difficult to secure new funding from banks.
• Housing. Across the UK 35% of SME civil engineering contractors surveyed relied upon the housing sector for more than 20% of their annual turnover. These firms anticipated losing around 46% of this housing-associated work as a result of the slump in the sector.
• Public sector work. 37% of contractors have seen a reduction in the availability of public sector works in the last 12 months across the UK.
• Overall total workloads. 66% of UK civil engineering contractors have seen a reduction in total workloads, with 31% of SME firms claiming to have less than two months worth of confirmed orders. 12 months ago this figure was just 9.6%.
• Payment. The average period taken for UK civil engineering contractors to be paid by clients increased by more that eight days in the past year, with 30% of firms seeing payment periods increase by more than 20 days. 76% of firms had seen an increase in the number of clients disputing payments recently, with this being becoming a regular occurrence for 24% of firms. 42% of firms have found increasing difficulties securing retentions owed to them by clients in the last year.
• Input cost inflation. 49% of firms claimed to have experienced cost inflation in the order of 7-10% in the last year. 12% said that inflation had been greater than 10%.
• Supplier/client relationships. 56% of firms have been hit by the financial collapse of a client or supplier in the last 12 months, with 9.8% of firms reporting that this has had a severe effect on their business. Meanwhile nearly four in 10 firms have struggled in the last year to secure credit from suppliers during the same period.
• Employment. 82% of SME civil engineering contractors expect to make job cuts in the next six months if current trading conditions continue, with 48% of having already shed staff. Based on Office of National Statistics figures for SME civil engineering contractors in 2007 (conservatively estimated at 50,000), this would equate to  predicted total job losses of 8,434, or 17% of the total SME workforce, by Spring 2009. This figure represents 3,006 jobs already lost, with a further 5,428 to go if the situation does not improve.