More than a third of Northern Irish construction firms are set to make redundancies if political uncertainty caused by the collapse of the country’s government and Brexit is not resolved soon, according to a new report.
A survey of 80 Northern Ireland-based construction firms found that 36% of respondents plan to make redundancies if politicial uncertainty is not resolved in the next three to six months.
The survey, conducted by the Construction Employers Federation (CEF), also found that 56% of respondents had delayed recruitment plans as a direct consequence of the political impasse in Northern Ireland.
In addition, 45% of respondents said the impasse had forced them to further shift their focus for new work outside of Northern Ireland.
Meanwhile, 83% of those surveyed reported substantial rises in labour and material costs over 2018, while two thirds reported similar rises in plant costs. Only 25% of companies said they had started Brexit-related preparations.
CEF managing director John Armstrong said: “Not since the deepest point of the recession a decade ago has our state of trade survey painted such a stark picture with respect to the concerns of the local construction industry.
“Two years of political intransigence has had the well-publicised effect of holding up public sector works, from values in the hundreds of millions to the tens of thousands, which have, as each month has passed, exacerbated the growth and employment-limiting issues that companies are facing.”
He added: “The absolute shame within this is that we are in a period when public sector capital expenditure is going up and the majority of companies have made great strides towards recovery and enhanced sustainability since the industry’s lowest point. Coupled with the ongoing development of local councils’ local development plans and the gradual recovery of private investment, this should be a time of great opportunity within Northern Ireland for the local construction sector.
“Instead, we are forcing local contractors to grow further the percentage of their work outside of Northern Ireland in order to stay afloat and maintain their current employee numbers.”
Of the companies surveyed only 2% said the construction market in Northern Ireland was getting “a little better” during 2019 while none saw it getting “a lot better”. In total, 70% of respondents said the market was staying the same or getting worse.
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