The Construction Product Association’s (CPA) latest Construction Trade Survey has revealed that construction activity increased across the supply chain in Q1, but uncertainty remains ahead of EU referendum.
This increase marks the twelfth consecutive rise reported by construction product manufacturers representing the beginning of the supply chain, through to main contractors, specialist contractors, SME builders and civil engineers carrying out work on the ground.
The survey revealed 19% of main building contractors, on balance, reported that construction output rose in the first quarter of 2016 compared with a year ago and 38% of specialist contractors reported a rise in output during Q1.
On balance, a further 13% of SME contractors reported increased workloads in Q1 compared to three months earlier and 25% of SMEs and 21% of specialist contractors reported an increase in enquiries in Q1.
However, the survey also reflected the continued uncertainty across the sector ahead of the EU referendum with a balance of 13% of main contractors reporting a decrease in orders in private housing and 42% reporting a decrease in public new housing orders.
Commenting on the survey, Rebecca Larkin, senior economist at the CPA, said: “After a slowdown at the end of last year, firms throughout the construction industry experienced a stronger opening quarter in 2016. In spite of this, the clear theme for Q2 is uncertainty, with main contractors reporting lower orders in all sectors as projects are paused or postponed ahead of the EU referendum in June.”
Richard Beresford, chief executive of the National Federation of Builders, said: “Uncertainty over the outcome of the EU referendum and over the nation’s defining issue – housing – is reflected in slowing industry performance. While homes will continue to be built, as long as there is uncertainty over Government policy, we will not be able to provide anywhere near the number of homes people need.”
