Budget reaction: Our poll of construction professionals

The government’s Autumn Budget has had a mixed response in the industry, with many lamenting the absence of construction as an identified growth sector in Labour’s 10-year industrial strategy, Invest 2035.

We polled more than 350 construction professionals, the majority surveyors and cost consultants, to find out what effect they think the budget will have in their own work area.

There wasn’t a huge amount of optimism on display when we asked what impact they thought the budget would have on the construction industry, with just 1% saying they thought it will have a very positive impact. 13% said they thought it will have a very negative impact, while 33% said it will have a slightly negative impact. 20% predicted a slightly positive impact and 23% said they didn’t think it would make any difference.

Dr David Crosthwaite, chief economist at BCIS, said: ‘I’m not surprised there’s a less than enthusiastic response to the budget. Labour made all these pledges about rebuilding Britain and get Britain building again, but it’s not clear how this is a budget which can turn those soundbites into reality.

‘Many key decisions, and outstanding consultations, are due in spring with the Spending Review, so we have to remain hopeful that we’ll get more commitment and clarity for the sector then.’

We also asked the construction professionals what they thought will happen to materials and labour costs, and labour availability over the next 12 months, in light of the budget.

74% predicted a rise in materials costs, while 14% said they expected them to stay the same and 2% said they would fall.

Similarly, 79% said they expected labour costs to increase. 14% thought they would stay the same and 2% predicted a fall.

On labour availability, 44% anticipated it staying the same, with 34% expecting a fall. Just 12% said they thought labour availability would increase in the next year.

Dr Crosthwaite said: ‘These are questions that we also ask hundreds of construction professionals on a quarterly basis when we publish our updated five-year forecasts. While the respondents are not necessarily the same, it’s interesting that significantly more professionals reflecting on the budget said they anticipate materials and labour costs will increase, than we found before the budget. The answers to the question about labour availability were broadly similar.’

When asked about expected workload, 49% said they expect it will stay the same over the next 12 months, while 24% anticipated a rise. 14% said they think their workload will fall in the next year.

Dr Crosthwaite added: ‘When we asked more than 250 construction professionals, the majority surveyors and cost professionals, the same question a few weeks before the budget, 43% said they thought their workload would increase in the following 12 months and 38% said they expected it to stay the same. Without reading too much into it, I would suggest that the budget hasn’t inspired much confidence that there is going to be much growth in the sector in the immediate future.’

You can access the poll results here.

To keep up to date with the latest industry news and insights from BCIS, register for our newsletter here.

Budget reaction: will it encourage investment in construction?

Budget reaction: can Labour meet its housing targets?

Budget reaction: what is the impact on construction?

Budget reaction: what does it mean for carbon in construction?

Budget reaction: how will it impact infrastructure and major projects?