Business

Lack of Stormont blamed for dip in construction sector

Northern Irish construction firms experienced a sharp dip in the final quarter of 2017, according to the Federation of Master Builders (FMB) Northern Ireland
Northern Irish construction firms experienced a sharp dip in the final quarter of 2017, according to the Federation of Master Builders (FMB) Northern Ireland Northern Irish construction firms experienced a sharp dip in the final quarter of 2017, according to the Federation of Master Builders (FMB) Northern Ireland

NORTHERN Irish construction firms experienced a sharp dip in the final quarter of 2017, according to the Federation of Master Builders (FMB) Northern Ireland (NI).

The latest State of Trade Survey has revealed that the overall indicator for the performance of Northern Irish construction SMEs dropped by 19 percentage points in Q4 2017 compared with the previous quarter.

Meanwhile fewer construction SMEs predict rising workloads in the coming three months, down from 41 per cent in the previous quarter to 38 per cent at the end of 2017. A total of 87 per cent of builders believe that material prices will rise in the next six months, up from 82 per cent in the previous quarter. The figures also show that nearly two-thirds (61 per cent) of construction SMEs expect salaries and wages to increase during the next six months

Director of FMB NI, Gavin McGuire blamed the lack of a Stormont Executive is to blame for the dip.

"A range of factors have contributed to these disappointing results, but the finger can largely be pointed at the political stalemate in the Northern Ireland Executive," he said.

"The Northern Ireland Assembly was dissolved in January 2017, and therefore this month marks a full calendar year of political uncertainty. In such circumstance, it should come as no surprise that the construction sector in Northern Ireland has started to dip. Political uncertainty goes hand in hand with low levels of consumer confidence and if consumers are less confident, the building industry suffers. Home owners are the lifeblood of the local builder who relies on people commissioning extensions, loft conversions, kitchens and bathrooms.”

“Aside from the political situation in Northern Ireland, the planning system can also be in part blamed for the slow levels of growth in construction. The numerous sources of delays and inefficiencies in the planning system impact upon development rates for new homes, and act as a major deterrent to small developers that need to see speedy returns on their investments," Mr McGuire added.