Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to the newest version of your browser.

Your browser appears to have cookies disabled. For the best experience of Construction News, please enable cookies in your browser.

Welcome to the Construction News site. As we have relaunched, you will have to sign in once now and agree for us to use cookies, so you won't need to log in each time you visit our site.
Learn more

Ere we go, ere we go, ere we go

PERHAPS it is the sunshine, perhaps it is Englands unexpectedly dashing performance in Euro 96, or, just maybe, prospects for construction companies really are getting better.

Without a doubt there is more optimism about now than for some time.

The latest figures do seem to point to a real recovery in construction after a very bumpy ride through two recessions in five years.

The value of new work won by contractors in the three months to May was 2 per cent higher than in the previous three months.

And the value of contracts won on a 12-month rolling total basis is on the rise and set to rise more on current trends.

There is a long way to go before the figures match those of two years ago but, given the poor performance this time last year, an upturn in this figure is almost guaranteed over the next few months.

Caution in the housing market is still evident in the figures for contract awards in the sector, which are still on the slide. House builders, eager to reduce the backlog of unsold homes, remain slow to commit themselves to building new homes.

But analysts are now more positive about an upturn in housing, which should feed through to construction.

Howard Proctor, analyst with brokers SGE, said: I am still fairly optimistic for growth this year and the figures fit with that view. I think that the declines some people have forecast now look too pessimistic.

Once the housing recovery feeds through, which I think it will any month now,

I think that it will have a significant impact on what is

already a slightly improving trend.

The figures for civils work are still holding up despite all the complaints in the sector and the latest government figures for infrastructure output for the first quarter of the year were also fairly buoyant.

But Mr Proctors view is that the sector is heading for hard times, particularly as the Private Finance Initiative work is failing to fill the gap left by cuts in public sector spending.

Civils are better than many have been suggesting, but it is questionable how long that will last, he said.

But he is more optimistic about the commercial sector, which has been boosted by a flurry of major project awards.

Commercial is still quite strong and I think that it will be a fairly robust sector for the next year or two, he said.

Meanwhile, orders in the industrial sector are continuing to improve, adding to the underlying optimism.