Surveyors gloomy about future, RICS findings say

More evidence that a downturn is coming has been provided by the RICS with the group saying confidence among surveyors is flatlining.

According to its latest quarterly report, construction workload activity for the whole of the industry slipped to +17% from +30% for the previous three months.

Only the infrastructure sector remained robust with a net balance of +32%. But the figures for private commercial, residential and industrial all headed south.

Labour and materials shortages were cited as reasons for the falls while worries about the wider economy were also at the forefront of respondents’ minds.

Simon Rubinsohn, chief economist at RICS, said: “The deteriorating macro environment is clearly taking a toll on the construction industry with access to credit now being cited as a key challenge for businesses alongside the more familiar issues around building materials and labour.”

The RICS report comes as information firm Glenigan said in its autumn forecast, also out today, that it expects output to fall into negative territory for this year and next with a slump of -2% across both. It said it expected growth to return in 2024 with a 6% increase across the sector.

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It said ongoing material, labour and energy supply chain disruption had been compounded by rising mortgages and government warnings that higher tax bills were on the way which had hit consumer-related construction such as private housing and retail.

Meanwhile, Irish consultant Linesight, bought last autumn by US firm Integrated Project Services, said so-called ‘mission- critical’ sectors such as life sciences and data centres were holding up well but were not immune from issues such as labour availability and costs, as well supply chain bottlenecks, as it too said construction demand was tapering off in its latest quarterly report.