Global programme and project delivery consultant Mace have published their Q3 2024 UK Mace Market View, outlining the state of the UK construction industry
The latest edition of the Mace Market View has been published, looking at UK construction output, interest rate reductions, stable material cost, and pay growth.
The report says that an expansion in workforce will be required in order to deliver the many houses required to hit the government’s housing targets.
Economic conditions are improving, according to the Mace Market View
Economic conditions are steadily improving, meaning new infrastructure and housing projects will rely on an improved operating environment.
The Mace Market View highlights several factors that will contribute to an improved operating environment, including collectively addressing industry challenges, solving labour shortages, and encouraging younger workers to enter the industry.
The last point is especially prudent in the report, as it places particular importance on expanding the workforce in order to hit the target number of houses needed.
Mace’s current tender price inflation forecast is sitting at the same place as earlier in the year, 2.5% for 2024 and 3% for 2025 and 2026. London figures are sitting at 2%, 2.5%, and 3% for the same years.
Construction output has shrunk for the third time in a row
Oliver North, director of Cost and Commercial Management, UK & Europe, Mace Consult said: “The government has a number of levers at its disposal that it can use to expedite improving market conditions. Creating the right environment to attract investment and helping to solve labour shortages for example, will have the potential to have a significant impact on output.
“While economic conditions are heading in the right direction and new orders are increasing, contractors and their supply chain are still working through legacy issues and current risks which, as we’ve seen with the sad news of ISG entering administration, can carry significant human and financial cost.
“Addressing these challenges collectively, taking a holistic approach to competition, will be a key enabler for the industry and its important role in infrastructure renewal and housing development in the coming years.”
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