WITH even the gloomiest analysts predicting, at worst, zero per cent growth and most hovering around the 0.3% to 0.7% mark, the UK’s 0.5% contraction caused quite an upset.
The blow was particularly severe in the construction sector, with the industry considered a large contributor to the fall. Activity decreased by 3.3% in the last quarter of 2010.
Whatever the cause of the contraction, it is time to look forward rather than back.
True, 2010 was not as we had hoped, and the forecast for 2011 is not particularly inspiring, however, we must not be short-sighted. We must look beyond the next 12 months, to the longer-term future of our sector.
New forecasts from the Construction Skills Network for 2011–2015 suggest there will be a slowdown in 2011, and a possible 76,000 further job losses before the sector returns to growth.
However, the report believes that the initial decline will be followed by a period of stabilisation and sustained recovery.
Yes there is bad news, but it is not all bad. Output is predicted to grow steadily between 2013 and 2015, expanding by an average of 1% across the whole forecast period.
This means that by the end of the five-year cycle, output is expected to be 6.2% above levels forecast for 2011. It will also mean an average recruitment requirement of 43,000, to fulfil the total of more than 200,000 new workers needed to complete planned projects.
And yes, there are in fact planned projects; major infrastructure investment, particularly in rail and water, have been announced, which is a real sign of longer-term confidence returning to the market.
In the North East, the hope for the longer-term future is much stronger than expected. Although output is expected to decline between 2011 and 2015, total construction employment is forecast to reach just over 105,290 in 2015, 8.8% higher than 2011’s projected outturn, and 2.6% higher than the national average.
What is paramount for the industry, particularly in the North East, is not only to weather the storm, but to be ready for the aftermath, ready for growth when it happens.
The Construction Skills Network has published its strategy for the next five years, with a five-point skills plan to promote growth.
First, prepare for growth through increased productivity. Second, be a part of the low carbon revolution. Third, engage with employers to meet the exact demand for skills. Fourth, tackle the recruitment challenge by ensuring a pipeline of new entrants, particularly through championing apprenticeships. Fifth, develop training and education provision for all to maintain competitiveness.
The future may not be bright yet, but there is at least hope on the horizon.
For more information on Constructing Excellence in the North East, contact chief executive, Catriona Lingwood, on 0191 374 0233 or catriona@cene.org.uk.
Catriona Lingwood, chief executive, Constructing Excellence in the North East