The recession in construction will be longer and deeper than we thought three months ago. That is the message in the latest set of industry forecasts emerging this month. This may evoke a sense of déjà vu. Each quarter of late the forecasts have darkened. The latest set look pretty bleak as we can see from the graph.
The consensus among UK’s top construction forecasters is that things are worse than we thought. A week ago we saw Experian and Leading Edge downgrade their forecasts for construction growth. This week we see the Construction Products Association do the same and Hewes & Associates will follow suit when it is published shortly.
The latest batch of industry forecasts are emerging and they show construction locked in a deeper recession than previous expected. The recovery now looks further away. Top graph shows how the industry appears to be facing a pretty deep and protracted second recession.
The Euroconstruct conference held earlier this month in London provided lashings of gloom, but it also provided plenty of food for thought. The twice-yearly conference brings together the thoughts and expectations of construction economic research groups covering 19 European countries. I have not been for many years and forgot how useful it was to look at the similarities and differences between countries. Even if you are not that interested in other European construction markets, seeing how they are performing helps…
Tomorrow we get the first hint of how construction might perform this year when the Gross Domestic Product preliminary estimate figures for the first quarter are released. Looking at the initial data on construction output for this year, I suggest everyone should be prepared for a nasty number to emerge within the data for construction’s contribution. But while I think it likely, that doesn’t mean it will. There are things we don’t know. What will early returns for March show?…
For those who like their news good, the story in the latest construction industry forecasts is that the mood is less pessimistic than it was three months ago. The two forecasts out so far in this spring round – Experian and Hewes & Associates – both tweaked their figures upwards for output over the next three years. Looking at this year, Experian revised its forecast from -5.6% to -4.4%, while Hewes saw a case to reduce the fall from -6.5%…
I have noted from conversations I have had recently a more confident air about the future within construction this side of the New Year. And the latest Markit/CIPS survey seems to add to this anecdotal evidence with its finding that confidence in the sector in January improved “to the second-strongest degree in the survey history to reach the highest since May 2011”. I’m not sure what that actually means in numbers but it sounds like a lot of improvement.
Construction industry forecasters are now expecting a drop in output next year of at least 5%. To put that fall in context, there have only been six worse years recorded since the data series began in 1955. And some might see the latest forecasts as potentially optimistic as they assume the Eurozone manages to muddle through its deepening crisis.
The prospects for construction are worsening, that’s the picture painted by the latest set of main industry forecasts. Even the least pessimistic of the forecasts, from Leading Edge, at best suggests the industry now looks to be facing two years of a second dip into recession. Hewes, which remains the most pessimistic of the forecasters, finds little reason to suggest that the industry will still be plunging in 2013, while the Construction Products Association forecasters reckon the industry will not…
I was wrong. Not all the construction forecasts are being revised down this time around. Experian has slightly lifted its expectations for construction growth for this year and next compared with its summer forecast. In the summer it was looking at a fall of 2.6% and 3.5% for this year and next, those expectations are now smaller falls of 2.1% and 3.3%. This is despite a lower forecast for GDP growth. Experian had revised its summer forecast quite a bit. And…