Construction sector struggles following BSF cuts
Construction work began to decline again in the second quarter of the year, according to the latest survey from the Royal Institution of Chartered Surveyors (RICS). The institution’s latest data shows 2 per cent more surveyors reporting a fall rather than a rise in total construction workloads in the West Midlands. This is in comparison to the previous quarter where 10 per cent more surveyors reported rising, rather than falling workloads.
The drop comes in the aftermath of the government’s decision to axe the Building Schools for the Future (BSF) programme.
According to RICS, the construction industry has been hit by fears over the scale of public spending cuts and ongoing uncertainty about prospects for the economy.
Although workloads in the private residential industry remain unchanged, most sectors of the construction industry have shown signs of a drop in workloads.
The large fall in the public works sector has been attributed to the suspension of the Building Schools for the Future programme (BSF).
Surveyors’ future expectations for employment revealed 16 per cent more surveyors in the West Midlands expect employment to fall than rise over the next year, equalling the national findings for those who anticipate a fall.
Adrian Aston, RICS West Midlands spokesperson and director at Wakemans, said the survey showed it was “too early” to conclude that the construction industry is on the road to recovery. He added: “Surveyors are also reporting an increase in competition for work as larger firms bid for smaller projects. Meanwhile, a continued lack of clarity from the government on existing projects is adding to the uncertainty. Given all these factors, it’s of little wonder respondents to the survey are feeling gloomy.”
It was revealed last month that more than 715 secondary schools in the UK would have their planned BSF projects cancelled as part of the government's latest round of spending cuts. A further 123 academy schemes are to be reviewed on a case-by-case basis. The £45bn scheme, which was developed under the Labour government, was scrapped as part of huge public sector cuts this year.
