Belfast Telegraph

Redundancies inevitable in Northern Ireland construction industry if Stormont stays idle: survey

Tough times: Some NI construction firms are feeling the financial pinch
Tough times: Some NI construction firms are feeling the financial pinch
John Armstrong

By Adrian Rutherford

More than a third of Northern Ireland construction firms will make redundancies if the political impasse is not resolved in the coming months, according to a survey.

Over half of respondents also said they have been put off growing their workforce as a direct consequence of the stalemate.

It comes amid warnings from a senior industry figure that the sector is being crippled by what he says is a political derogation of responsibility.

John Armstrong from the Construction Employers Federation (CEF) said we could be sleepwalking into a "wholly unnecessary catastrophe".

Northern Ireland has been without a functioning government for more than two years.

According to the latest State of Trade Survey, local construction firms have identified the absence of the Executive as the major contributory factor towards their inability to grow and meet their job-creating potential.

The survey, covering the second half of 2018 and conducted by the CEF, took the opinions of 80 construction firms headquartered here.

Collectively, the companies were responsible for turnover of approximately £950m last year.

The survey's key findings included:

  • 56% of respondents have put off growing their workforce as a direct consequence of the political impasse;
  • 36% said they will make redundancies if the situation is not resolved in the next three to six months;
  • 80% of respondents said the lack of an Executive had led, directly, to a reduction in the number of projects coming to the market;
  • And 45% said the impasse had forced them to further shift their focus for new work outside of Northern Ireland.

Mr Armstrong, the federation's managing director, said: "Not since the deepest point of the recession a decade ago has our State of Trade survey painted such a stark picture with respect to the concerns of the local construction industry. "Two years of political intransigence has had the well-publicised effect of holding up public sector works, from values in the hundreds of millions to the tens of thousands, which have, as each month has passed, exacerbated the growth and employment-limiting issues that companies are facing."

Some 75% of companies surveyed said only with the restoration of the Executive could the industry achieve its growth potential. However, 75% of those surveyed worked at either full or almost full capacity in the last six months of 2018.

It also found 42% of respondents said profit margins were worse than this time last year. A further 35% said they were the same.

In October, Secretary of State Karen Bradley passed legislation designed to give greater clarity to their decision-making powers.

Mr Armstrong said this is beginning to have an impact with progression of some stalled projects. But he said that legislation can only be a stop-gap measure.

Mr Armstrong added that Northern Ireland will struggle to deal with many key challenges.

He said: "At a time when we need to consider fundamental restructuring in the governance and funding of some of our key public assets, we are actually sleepwalking into a wholly unnecessary catastrophe which it may take years to see a way out of."

The British and Irish governments met the five main parties last Friday.

Afterwards, Sinn Fein leader Mary Lou McDonald dismissed efforts to kick start talks at Stormont as a "sham".

Mr Armstrong said it appeared the collective political class was "oblivious" to firms' concerns.

He added: "If such a sense is true, and it is increasingly hard to contradict it, that represents a staggering derogation of responsibility at a time when leadership is required more than ever."

Belfast Telegraph

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