Call us 9am-5pm Mon to Fri0161 233 4499
News

2016 Construction Market Outlook

By CIEEM Insurance Services
11.03.16

The construction industry experienced inconsistent growth throughout much of 2015, due, in part, to the lingering repercussions of the recession. While the first half of 2015 saw accelerated growth, the second half experienced an unexpected slowdown owing to bad weather, which hindered construction projects.

However, the industry remains optimistic—the Construction Products Association estimates growths of 5, 7 and 7.9 per cent for the private housing, offices and infrastructure sectors in 2016, respectively. This favourable outcome comes in response to the high demand for the construction and repair of homes and general infrastructure after the devastation of Storm Desmond.

However, amidst the tentative success of 2015, there are seven main risks which may impact growth in 2016:

  1. Skills shortage in the United Kingdom: According to the Local Government Association, 56 per cent of current skilled trade construction vacancies are proving to be difficult to fill.
  2. Introduction of building information modelling (BIM): The digital collaborative process may expose construction firms to cyber risks.
  3. Increase in timber-frame construction: While construction firms would be able to more easily meet the housing demand using timber-frame construction, it could expose homeowners to fire risks.
  4. ‘Icebergs’: These multi-storey basements (common in London) are technologically challenging, require thorough planning and may expose homeowners and construction firms to health and safety risks.
  5. Weather events: Changes in the jet stream are expected to result in more extreme and prolonged weather events.
  6. Green belt building: While building new homes on the green belt may be necessary to meet the ever-growing housing demand, unfortunately, it also increases the risk of flooding.
  7. Counterfeit cranes: Some companies are making inferior construction equipment and branding it with a reputable logo in order to scam firms.

 

To read more download the full 1st Quarter 2016 edition of Construction Commercial Insurance Profile

View the complete document archive