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Civils contractors workload continues to fall

The first Civil Engineering Contractors Association Workload Trends survey to be carried out since the General Election shows that the change of government has slowed the decline in the industry’s fortunes.

While the majority of contractors are still reporting that they have less work now than they did at the same point in 2009, the balance between those reporting falls in work and those reporting rises has swung back towards positive territory.

The results of the survey, which was carried out in June and July, show that 51% of firms reported lower workload and 27% reported higher workload since the previous survey in April.

The balance between the two figures was -24%, a significant improvement on the -59% balance reported in April. This in turn was an improvement on the -77% balance reported in January 2010 and the -64% in October 2009.

This improvement was largely driven by those sub-sectors that are dominated by private sector clients. Workload in the water sector improved from a balance of -63%in April to -25% in July. Similar gains were made in electricity, which improved from -53% to -12%.

However, CECA members reported that public sector workloads continued to drop, with strategic roads work down to -51% from -21% in April. Similarly, local road works has dropped slightly to -54% from -50%.

Looking forward, members expect declining workloads in the year to come. Around 45% of companies are anticipating lower workload, with just 14% of firms predicting increased work.

“At a time when the industry is still struggling to bounce back from the recession, any improvement in contractors’ workloads is welcome,” said CECA head of industry affairs Alasdair Reisner.

“However, we need to treat this apparent upswing with caution. The results remain in negative territory with only those sub-sectors of the industry that rely on private sector clients showing any improvement. Even here there is no guarantee that this recovery will be sustained. Civil engineering contractors will face a difficult time over the next few years, particularly as the impact of public sector spending cuts starts to bite.”

Last week CECA said the government had not done enough in its first 100 days in power to provide confidence to the sector.

“There have also been welcome signs that the government is taking investment in infrastructure, which will boost productivity, prosperity and quality of life, seriously,” said Reisner. “However, there are many opportunities being missed.

“We are still without a cast-iron guarantee that Crossrail will go ahead. Until the Comprehensive Spending Review is complete we are in limbo over a number of important issues, such has the level of funding and support the Government will provide for road maintenance.

“The Coalition Government faces a serious challenge if it is going to keep the country moving and keep the lights on in the long term. As we have argued all along, investment in the UK’s infrastructure, especially transport and energy, will play a fundamental role in delivering a sustainable, low carbon economic recovery.”

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