Firm revises number down for second successive quarter

Mace has pared back its tender price forecast for the year ahead as falling materials costs and an impending recession blunt hikes.

The firm had previously send prices would jump 3.5% this year, down on previous estimates, and in its latest report for the final quarter of 2022, it said this had been revised down again to 2.5%.

It said workloads would be helped this year by a resilience in the sector with construction output growing 0.6% in Q3 and an increase in new orders of 6.4%.


Source: Shutterstock

Designed by Allies & Morrison, Mace is due to finish work building the new London College of Fashion (right) this autumn. It will be part of Stratford’s new East Bank cultural and education district. The building on the left, also built by Mace, is the V&A East scheme designed by O’Donnell + Tuomey

Andy Beard, Mace’s global head of cost and commercial management for its consulting arm, said: “The industry faces a difficult year ahead. However, the construction industry’s moderate output growth and increase in new orders is an optimistic indicator for the industry to remain resilient compared with other sectors.”

But he warned: “The industry is likely to face obstacles in terms of material cost pressures and the impact of inflation on profit margins.”

Meanwhile, data firm Experian said construction output would fall 1.7% this year across the sector making the recession more shallow than previously thought. It added that it expected growth to return next year with a 1.1% hike.