Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Civils contractors earn record £13.5bn

Civil engineering contractors have this week dismissed fears of an economic slowdown after exclusive research by NCE showed the market to be in rude health.

An exclusive survey of the finances of 118 firms for NCEs Contractors File 2008 has revealed the UK civils market to now be worth 13.5bn, up around 0.75bn on last year. The File is sponsored by the Civil Engineering Contractors Association and is a unique analysis of the civil engineering contracting market.

The biggest concern of the big civils firms is achieving planned growth, not protecting diminishing returns.

“Our biggest concern going forward is achieving planned growth over our record order book of approximately 2bn whilst enhancing the quality of service in the inevitable overheating construction market running up to the 2012 Olympics,” said Costain group strategy & business development director Stephen Wells.

“Put simply, we can get the work but need the people,” added Galliford Try Infrastructure managing director Ken Gillespie.

“The recruitment and development of good quality people is getting harder and harder. These factors are a major barrier to maintaining high levels of customer satisfaction, employee satisfaction and profitability and, ultimately, to the company continuing its progress.”

Confidence rebounds around the industry, with firms on average predicting a 10% growth in turnover at a 5% margin over the next two years.

This confidence jars with the figure for work in hand, which at 20bn is 4bn down on last year.

But there are high hopes for new markets, specifically waste and energy, to come on stream to replace any downturns in more traditional markets for civils contractors.

Roads remain the biggest employer of resource, with 89% of firms turning over just over 2bn in that sector last year, but just 28% of firms expect to see it grow. Eighty per cent were working in the 1.5bn buildings sector, but just 17% expect to see this sector on the up.

Waste, a sector 75% of firms are already operating in, is now seen as the sector with the most opportunity. Almost half of all firms cite it as a growth area.

Energy is now second favourite, with 36% of firms citing it for growth, despite only half of firms are currently operating there.

The big turn-offs are water, building, and specialist geotechnical. Just 6% of contractors identify geotechnical as a growth area, and this gloomy mood is also reflected in NCE sister magazine Ground Engineering’s Geotechnical Services File, also published this week.

Its survey of 311 geotechnical and geoenvironmental firms show just 61% expecting heavier workloads next year, compared with 81% last year. Turnover amongst the top 10 firms has also levelled off with combined geotechnical earnings now at 609M, just 2M up on last year.

Atkins geotechnics and tunnelling managing director David French insisted opportunities for work on transport infrastructure and environmental projects remain strong but warned of the sector’s vulnerability.

“Beware an economic downturn, which is likely to hit brownfield development first,” he said.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.