How is collaboration in the construction sector progressing in 2023ā€‹
Snapshot Survey
April 2023
Background
Last year in August 2022 we carried out a Snapshot Survey that looked at ‘Collaboration in Construction as the Sector Enters a More Inflationary Economic Cycle’ prompted by the publication of an article in the Sunday Times of the 7th August, 2022: ‘Brickies Go to the Wall as Prices Rip Through Construction’
Since then the Sunday Times has published a further article on the 5th February, 2023: ‘Tradesmen Bashed by Building Site Bullies’. This article, a difficult read for many in the Sector but nonetheless insightful was a damming condemnation of behaviours across the sector that our August Survey data supported.
Given that some 8 months had passed from that August Survey; the recent Sunday Times article; and the latest Economic Forecast of the IMF last week it seemed a timely opportunity to find out what people in the sector currently think.
To summarise:
- Output in the Construction Sector has flatlined as has productivity;
- Prices have continued to rise with inflation currently just above 10%;
- Supply Chains have improved but they are still availability and delivery issues around some
products and materials; - Many companies in the sector have continued to seek restructuring or simply ceased to
trade with insolvencies at the highest level for 13 years; - Some 53% of invoices are being paid late;
- The Government’s Housing target of 300,000 homes a year has now been ditched;
- Interest rates have risen to 4.5% and may go higher in the short term with uncertainty as to
when and if they will return to lower levels; - Firms across the sector are continuing to bid for Contracts on which they may make little to
no money indicating that a ‘race to the bottom’ exists; and - Labour and skills shortages along with an ageing workforce provide ongoing challenges.
The survey
The above points were sent out to a database of people who had attended Constructing Excellence and partner webinars over the last two and a half years in an email along with an invite to complete a short survey.
The Survey comprising of 5 questions was sent out twice to this database on the 18th and 20th of April 2023 with the results comprising of the feedback given on those two days.