BESA trade survey shows optimism
Building-engineering-services contractors have reported increased turnover in the second half of 2015 in the latest state-of-trade survey carried out by the Building Engineering Services Association (BESA). The industry remains in ‘good shape’ according to the research, although the rate of increase in order books and enquiries was less than in the previous six months.
Tender prices continued to rise throughout the period, but more slowly than in the first six months.
Problems with late payments eased slightly, but remain a serious impediment to business grow, according to BESA members, who also reported increasingly severe shortages of skilled employees — particularly design engineers, quantity surveyors and planners — had led to a sharp rise in labour costs.
Employment levels remain healthy, but smaller companies (with an annual turnover under £1 million) are less active in recruitment than larger companies. Overall, a net of +37% expected to employ more staff in the first six months of this year, a similar level to the last survey. There was also a net increase in those engaging agency labour.
BESA president Jim Marner believes that the next three years will be hugely challenging for building-services firms, but also potentially rewarding.
He says, ‘Skills shortages, labour costs, project risk, procurement and quality control will all become even more significant in the coming months, along with efforts to adopt more modern design methods.’
He added that the industry was facing its second ‘perfect storm’ in recent years, with the growth in workload coinciding with skills shortages and pressure on cash flow — and that contractors would have to ‘step up to the challenge once again’.
The market drivers and technical challenges faced by firms in recent times would be ‘magnified times 10’ between now and 2018, according Jim Marner.
The next three years would also be full of opportunity, however, with the secret of future success lying in the creation of a ‘smart’ workforce ‘equipped with tomorrow's skills, but operating in today's marketplace’.
‘The wider use of BIM, along with offsite manufacturing, means we will need new kinds of skills,’ he explains. ‘We will be spending less time on-site, but that doesn't mean we will need a smaller workforce. What we will need is a smarter one.’