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Construction businesses forecast positive year for sector

The Scottish construction sector expects to regain ground lost following the EU referendum with growth forecast in workloads, employment and profit, according to a new survey.

The Royal Institution of Chartered Surveyors (Rics) Construction Market Survey for the fourth quarter of 2016 found expectations of output growth over 2017 strengthened following a dip after the Brexit vote.

Workload growth expectations improved from +7% in quarter-three to +27% in quarter-four, and 20% more survey respondents said they expect a rise in employment in 2017.

The survey found modest growth in the Scottish construction sector in the final three months of 2016 with 7% more respondents reporting increasing workloads.

The private industrial sector is seen to be driving growth as 23% more respondents reported an increase.

Private commercial and private housing also increased between September and December, but public non-housing works fell in the same period.

Respondents warned of skills shortages restricting growth, despite easing in five consecutive reports, with half of those surveyed pointing to a lack of quantity surveyors.

Stephen Daniels, director of construction consultancy MB Langmuir & Hay in Glasgow, said "Labour shortages are impacting on projects, leading to delays."

Simon Rubinsohn, Rics chief economist, said: "The latest results suggest that the construction sector has shrugged off concerns about the effect of Brexit with key workload indicators remaining firm around the country.

"Indeed, feedback regarding the outlook over the next 12 months is now rosier than it was back in the autumn with more building anticipated as 2017 unfolds.

"That said, there remains some unease about access to skilled labour in the emerging new world and financial constraints still remain a major challenge for many businesses. And significantly, we are being told that a shortage of quantity surveyors is impacting on the development process at the present time."

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