Belfast Telegraph

Stormont stalemate undermining construction industry, reports warn

Jim Sammon
Jim Sammon
Ryan McAleer

By Ryan McAleer

Northern Ireland's construction industry is feeling the impact of the Assembly shutdown, a series of reports show.

Research released today from organisations including the Royal Institute of Chartered Surveyors (RICS), Tughans, US engineering firm AECOM and the Federation of Master Builders (FMB) reflect growing pessimism and concern within the sector.

The latest RICS and Tughans Construction and Infrastructure Market report for October to December found builders in Northern Ireland are the least optimistic in the UK, with workload expectations also at the bottom of the table.

Despite recent growth in private house-building and commercial construction, two years on from the collapse of the Executive the survey showed further falls in the volume of publicly funded building work.

Based on responses from surveyors across Northern Ireland, the report also hinted at falls in activity in respect of public housing, public non-housing and infrastructure.

Overall, construction companies here are less positive when it comes to workloads, employment prospects and profit margins.

Jim Sammon, from the RICS in Northern Ireland, said: "The lack of decision-making in government continues to impact on construction activity and on the delivery of important projects.

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"Alongside uncertainty relating to Brexit, surveyors cite this as a major challenge for the market and they anticipate 2019 will be a challenging year."

Speaking ahead of the launch of a review into the construction industry on both sides of the border today, AECOM's director in Northern Ireland, Trevor Leader, insisted the current political climate remained the biggest concern for the industry here.

"The lack of an Executive in Northern Ireland, which has slowed the rate at which public sector projects have come to market, was identified as a source of frustration," he said.

"However, the review suggested that clarity on this issue could lead to a flurry of public sector projects being tendered, which could underpin the long-term sustainability of the industry."

Meanwhile, new research from the FMB showed that the pace of growth among Northern Ireland's smaller construction companies quickened during the final months of 2018.

However, the association's latest State of Trade Survey highlighted a series of major concerns within the industry.

The report found that 42% of builders have detected signs of a weakening housing market, while one in five construction SMEs have had projects stalled in the past three months due to delays to loans, or loan refusals, from banks.

The research also revealed that carpenters have overtaken bricklayers as the trade in shortest supply, with nearly two-thirds (64%) of construction SMEs struggling to hire carpenters and joiners and 61% struggling to hire bricklayers.

RICS policy manager Martin McAuley said: "Northern Ireland's construction industry continues to face the twin hurdles of an extended political impasse and ongoing uncertainty surrounding Brexit.

"The fall in public workloads reported by surveyors reflects a continued stasis at Stormont, where there appears to be no effort to restore the Executive.

"As investors give further consideration to private projects in the context of Brexit, markets need more political certainty if the outlook is to improve."

Belfast Telegraph