It looks like we are finally going to see sustained growth in the UK construction market, after a very difficult period since the financial recession first hit in 2008. It certainly has some way to go – total output in 2012 at £83 billion (in 2012 prices) was still only at the same level as 2002 in real terms.
However, growth of around 2.4% in 2013 is forecast by leading body Construction Products Association to be followed by 4 years of c4% p.a. growth to 2017. Led by private house-building (who can fail to see all the news about house price rises and booming house-builder shares?), infrastructure is also growing (especially road and rail, with nuclear a potential bonus), while the market for offices and retail is seen as ripe for further growth.
We have been here before and not everyone is convinced that it will be this rosy. However with an election due in May 2015 we expect to see a healthy recovery until at least that date. There is perhaps inevitably a health warning with this optimism. There are already reports of skill shortages and increasing prices of materials (including bricks), so construction contract prices are likely to rise over the next year or so.
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