We will go to the ball

As 2014 draws to an end, it is a huge relief to be able to say that, for the sector, this year the curtain finally seems to have come down on recession as well. The signs of light that were there back in January, when Experian was forecasting 4.2% growth over the year, have - stoked by a strong housing market - strengthened into growth that the firm predicts will have hit 5.5% by the end of the year.

The steadily improving performance has translated into a run of positive stories throughout the year that would have seemed strangely out of context even 18 months ago. Housebuilders have reported record results; consultants and architects are hiring faster than Cinderella racing to hit her midnight curfew, and the year has seen a run of major mergers in both contracting and consulting as UK firms bid to compete on an increasingly global stage.

This is not to say, however, that the industry has left all of its difficulties behind for good. Both the Construction Products Association and Experian predict the industry will grow by more than 5% next year, but this is set against a backdrop of increasing economic uncertainty in Europe and a strong message from both Labour and the Conservatives that, whoever triumphs in next May’s election, UK public spending will be constrained throughout the next parliament - to levels not seen since the thirties, according to the unseasonably gloomy forecasts of the Office for Budget Responsibility.

The election itself, and the perhaps inevitable lull in spending in the run-up, also threaten to act as a drag on momentum. This is of particular concern given growing signs that the housing market, which has so far underpinned the sector’s recovery, is faltering. The industry needs private sector growth to escalate in the first half of the year to mitigate any public spending slowdown, rather than the reverse.

But even if output growth does turn out to be slower than some would like next year, this does not mean that the brakes should be applied to the sector’s rejuvenation in a more general sense - in fact, quite the reverse.

The run-up to the general election provides possibly the biggest opportunity of the next five years for the industry to make itself heard on the issues that would create a more stable, efficient sector for the future, thereby reducing the risk of a repeat performance of the past five years: measures such as longer term infrastructure planning, a workable programme of green retrofit, and still better visibility on capital spending. Building’s Agenda 15 manifesto, which will be launched in January, following our year-long industry consultation over the issues that matter most to you, will be central to our efforts to help make sure politicians hear those views.

In addition, one of the biggest pressures that construction will face over the next year - the mounting skills shortage that could prevent firms taking advantage of the upturn - is one that individual companies, and the industry as a whole, can move to address without waiting for political intervention, helpful though that would undoubtedly be. Again, exploring the ways the sector is tackling the skills issue will be central to our coverage next year.

Finally, any slowdown in opportunities in the run-up to May’s election could provide a helpful window for companies already casting an eye over their rivals to make a bid for rapid growth through acquisition. With some major contractors, in particular, still facing an uphill task to battle the legacy of low margin work won in recession, and thereby leaving themselves open to approaches, the tale of M&A promises many more twists next year.

So, one way or another, 2015 is set to present a packed programme for the industry. Before it gets here, on behalf of all at Building, I would like to wish you a happy and relaxing Christmas - and, when it does arrive, a very successful new year.

Sarah Richardson, editor