The construction industry is no doubt embracing the green shoots of recovery, with businesses reporting growth and planning for this to continue throughout this year.
With an improved economy, increased recruitment is now on the horizon, but good news stories in the media have also led many in this industry to feel pressure when it comes to increasing staff salaries.
If positive reports are to be believed, then the construction industry is well on its way to carving out a more solid position.
Housebuilding is pushing this sector forward as demand for new homes continues to rise. With government schemes helping more people to get on the property ladder, housebuilding is set to make up more than a third of this industry’s almost £120bn generated annually.
What next for construction?
So as we start to emerge from the recession, and see strong indications of recovery, those in the industry may start to ask themselves: what’s next for the construction marketplace?
Recent research by Office Depot has provided unique insight into UK businesses speaking to 250 managing directors and owners of large companies spanning 15 industry sectors – including construction – and what has been revealed is rather surprising.
According to recent figures from the Office for National Statistics, the UK’s construction industry grew by 0.6 per cent in Q1 2014, when compared with the final quarter of last year.
And, when comparing the first quarter of this year with the first quarter of 2013, the industry has grown 5.4 per cent.
This renewed optimism for the industry is reflected in the fact that three quarters of those in construction who participated in the Office Depot research are anticipating growth to continue throughout 2014.
It can be difficult at times to draw realistic conclusions from what is reported in the media, but 59 per cent of participants in construction believe that the positive reports about the economy are accurate and representative of their industry.
A recent report from the Construction Industry Training Board said that 182,000 new construction jobs will be created by 2018, bringing the number of people working in this industry (2.588m) closer to the pre-recession figure of 2.863m.
When we asked if managing directors predicted a higher turnover of staff due to the improved economy 41 per cent said it was not a worry. More than three quarters (82 per cent) said that they would be looking to recruit more staff, to help meet demand in the sector.
Despite the buzz around the improved economy, some will be remaining cautious.
Although there is a certain amount of pressure felt by almost two thirds (59 per cent) construction business owners to give wage rises, a third (36 per cent) will be choosing to remain cautious and hold on to capital for the time being. However, two thirds (64 per cent) have seen sufficient growth to start planning for wage increases this year.
In comparison to other sectors who took part in our research, those in construction are working with increased optimism, with results of their perseverance and contribution to the UK economy starting to show. Bolstered by growth in the private housing market, this industry looks set to continue to flourish further.
Matthew Letley is director of construction at Office Depot