Despite complaints that Brexit uncertainty is negatively impacting the UK’s construction industry, experts show that the market is actually growing.
According to the latest Builders Merchant Index, which uses data from sales by merchants to builders and other trades, construction is currently showing “year on year growth of 5.4%”.
In particular, landscaping was the part of the industry to show the greatest growth (+10.7%), followed by plumbing and heating (+7.3%).
However, industry experts claim that already the outlook for the second quarter of 2016 is showing signs of hesitancy, “because of the uncertainty caused by the EU referendum.”
Managing Director of the Builders Merchants Federation, John Newcomb, said “there are very mixed views in the construction industry, including amongst merchants, about the Brexit debate, but one thing that is clear from our data is that the uncertainty is impacting on the level of activity in the construction industry.
The Builders Merchants Federation represents companies supplying materials to 80% of Britain’s builders, plumbers, joiners and decorators. Mr. Newcomb added that “the industry is looking forward to the EU question being settled” because “our members report that investment decisions are being put on hold until after the referendum and the general feeling is that we want this out of the way now, whatever the outcome is.”
Nigel Cox, Managing Director of Timbmet, explained that “businesses are delaying project decisions and investments until the outcome is known.” As Timber is an “international business,” Mr Cox adds, “the uncertainty is also affecting exchange rates,” claiming that the effects of the uncertainty would therefore not be felt until after the referendum.
Steve Durdant-Hollamby, Managing Director of AWMS says: “The construction industry desperately needs more skilled tradesman but banks are not lending money and investment in new company start-ups is being held back until people know where they stand on Europe”.