Architects' confidence takes a dive after Brexit vote

Architects’ confidence has plummeted since the UK voted to leave the EU, according to new figures from the RIBA.

The most nervous are large practices.

It is the first time the monthly Future Trends survey has entered negative territory since 2012.

The workload index fell from +22 to -7 in July. It had already slipped from May’s high of +30 as pre-referendum jitters began to kick in.

The data for this month’s survey was collected immediately after the vote so it is possible the next report will show a steadying of nerve.

But Adrian Dobson, the RIBA’s executive director for members, said it “must be a cause for some concern”.

“While a very small number of practices state that they have seen projects cancelled or postponed as a direct result of the referendum outcome, the sense is that the fall in our index reflects anxiety about the future impact of the decision rather than an immediate change in the workload pipeline,” he added.

The survey revealed that large practices with more than 50 staff have suffered the biggest loss of nerve, with their workload index figure crashing to -33. The figure for small practices of 10 or fewer staff is -7. The only practices to predict rising workloads were medium-sized firms, with a figure of +8. Any figure above 0 is a sign of a firm predicting growth.

The worst-hit sector was commercial, falling 28 points to -17. Private housing also took a big hit but remained positive, down from +19 in June to +4.

The forecast for public sector work fell to -5, community work to -4. Both sectors were already suffering.

Meanwhile, actual workloads are actually growing at what the RIBA called a “healthy annualised rate” of 3%, indicating that the survey results are a reflection of architects’ anxiety about Brexit implications rather than any immediate falling off in growth of revenues from architectural services.

And the staffing index, which fell from +14 in June to +4 in July still indicates practices are planning to take on staff, just at a lower rate than before the referendum.

Dobson added: “Anecdotal commentary received from our participating practices this month was dominated by the Brexit decision. A very small number of practices did report seeing an immediate impact on projects, but many said it was too early to say what the effect on their workflows might be, whilst a good number stated that they were not expecting to see any changes to work levels as a result of the referendum vote.

“In reality we seem to be in a wait and see position for many practices at present. The RIBA Future Trends survey has recorded a continuous increase in the value of work in progress since mid-2013, and the profession has been increasing in economic strength with staffing levels also rising strongly. At the moment the sense is one of a profession pausing for reflection to see if that momentum will continue or not.”