RICS’ workload survey for the first quarter of 2022 found 84% of respondents reporting material costs to be impeding construction activity.
The good news is that the work is there, however. RICS Global Construction Monitor Q1 2022 found that 34% of respondents reported a rise in workloads in Q1, this slightly up from 33% in Q4 2021, with the infrastructure sector mostly credited for the rise. More than half of respondents (53%) reported a rise in workloads in energy infrastructure.
The bad news is that, despite the strength in current workloads, global supply chain shortages are being felt. It is not just materials – labour/skills shortages also remain an issue, according to more than 70% of respondents.
Across the regions, northeast England, Yorkshire and northwest England posted the strongest growth in workloads with 41% of respondents reporting a rise. The midlands and east of England are the most optimistic, with 47% anticipating growth in the year ahead.
RICS chief economist Simon Rubinsohn said: “The good news in the latest report is that the industry remains positive about the outlook for activity and that the generally upbeat mood can be seen not just in regard of infrastructure and housing development but also in the commercial sector. However, it is clear that the sector faces significant challenges which have been reflected in recent official data showing a sharp rise in vacancies across the construction industry. RICS numbers demonstrate these shortages are pretty much across the board including quantity surveyors and project managers as well as both skilled trades and more general labour. This, combined with problems around accessing building materials in the current environment, is exerting significant upward pressure on construction costs at the present time.”