It may look flat, but in my book that’s positive
Viewed from a particular angle, the latest RICS Construction Market Survey for the second quarter of this year is fairly positive, in the circumstances.
Workloads are broadly flat according to the survey respondents, which is a bonus in my book given the state of the economy and the outlook.
The net balance [of the percentage change in workloads] moved down from +6 to +2, but at least that is above the zero mark, even if the distinction is more relevant to the industry’s psychological wellbeing than its physical condition.
More encouragingly, the consensus appears to suggest that things will get better, with 10% more of the sample optimistic than pessimistic about workload prospects over the coming year.
There is even a suggestion that there will be more jobs with a +6 balance of firms reckoning they will increase jobs over the coming 12 months. Perhaps more telling, though, is the view on profit, which is pretty heavily negative.
The big question hanging over construction is: how strong will the recovery be in private sector investment and will it be sufficient to fill the huge gap left by the retreating public sector? The forecasters hold the view that the private sector recovery is a bit more pallid than they thought earlier, but fortunately the slide in the public sector is slower than it might have been.
The survey does seem to find positive signs of growth in the private sector, albeit along with a rather sharp fall in public sector work. The net balance, though, does seem to be mildly positive.
Mind you, the positives are rather restricted to London and the South-east. The further you move from the capital the more despondent you’ll find the survey respondents. It is grim up North, where even hope of growth remains forlorn.