Construction companies will have to find new markets to carry them through 2011
Most big firms have been reporting an increase in overseas work for several years and there has been growing interest in new markets, including Brazil, India, China, the Middle East and, most recently, North Africa. Global hotspots of the future will include Vietnam, Australia, Russia and Qatar.
And while overseas markets will take some of the pressure off construction firms, certain sectors here in the UK will continue to offer lifelines. So which areas are worth particular attention?
Investment in transport in the UK has remained relatively stable compared with some other areas. Kulveer Ranger, Boris Johnson’s transport adviser, says: “We are in a period of unprecedented investment in transport - there are the Olympics, Crossrail, line upgrades, the East London line, High Speed Rail 2. And … post-2017, there’s Crossrail 2, high-speed rail, further development of the overground.”
Power, energy and nuclear
Infrastructure UK has predicted that £100bn will need to be invested in this sector between now and 2015. “The UK suffers from an ageing energy infrastructure, has a significant nuclear decommissioning bill, an EU-driven obligation to generate 15% of UK energy from renewable sources by 2020 and a commitment to a 30% reduction in carbon emissions by the same date,” explains Victoria Jackson, business development manager of Davis Langdon. The energy department’s allocated capital budget was increased by 41% in real terms from £1.7bn in 2010-2011 to £2.7bn in 2014-2015.
Water and waste
The government will spend £22bn between 2010 and 2015 on the water sector. On the waste side, up to £11bn is needed between now and 2020 to meet EU targets for landfill diversion. Neil Morris, managing director of international property and construction recruitment consultant Digby Morris, says these sectors overseas will also offer up opportunities for UK firms: “Over the next 10 years globally about £500bn will be spent on the water and waste sector,” he says. “So there will be a massive increase in demand for people with these skills sets all over the world.”