Construction bosses 'nervous about future work prospects'
Employers' confidence in the Scottish construction industry has been affected by fears over future work prospects, according to analysis by industry experts.
Employers' confidence in the Scottish construction industry has been affected by fears over future work prospects, according to analysis by industry experts.
The Scottish Construction Monitor surveyed Scottish Building Federation members and asked employers to rate confidence in business prospects over the next 12 months compared to the past year.
After three consecutive quarters where confidence was given a “plus 2” rating the quarterly survey showed it has slipped into negative territory this quarter, falling seven points to “minus 5.”
Employers pointed to growing fears over future new work as a potential explanation for the fall.
Major projects such as the Queensferry Crossing and the Aberdeen Western Peripheral Route, they say, are drawing to a close and there is apparent shortage of other work to fill the gaps.
Stephen Kemp, president of the Scottish Building Federation and managing director of Orkney Builders, said: “Many building employers are increasingly nervous about the future prospects for our industry.
“There is a feeling that the underlying fundamentals of the industry are not nearly as strong as record output figures might suggest.
“We know that a period of record output from major infrastructure projects such as the AWPR and the Queensferry Crossing is about to come to an end.
“Strip away those numbers and the performance of other key sectors of the industry such as housing and private commercial don't look that strong.”
Mr Kemp said his members were now worried that recovery in the industry could slip into reverse.
He added: “To ensure the long term health of the construction industry and the wider Scottish economy, the Scottish Government now needs to focus on supporting smaller scale projects throughout Scotland.”
Statistics show strong output across many sectors of the industry over the year to March 2017 with major infrastructure projects contributing to overall output.
The infrastructure sector of the industry, however, contributed less than #1 billion of industry output during the same period.
Housing contributed 19% to output and the private commercial sector of the industry has dropped from 25% in 2006/07 to 18% in 2016/17.
Industry leaders say the focus of the construction business should be on supporting smaller scale projects throughout Scotland.
William Gray, managing director of William Gray Construction and a director of the Scottish Building Federation, said: “The long term trend in employment in Scottish construction has been downward.
“Here in the Highlands, we've seen the local industry workforce drop from almost 11,000 in 2006 to around 6,700 last year.
“More recently, we have seen industry employment showing some modest signs of recovery.
“But there has definitely been an over-reliance on major infrastructure projects to sustain the industry.