20 July 2012
The RIBA future trends survey index took a hit in June falling from 13 to 2. This finding that architects are less optimistic about prospects is pretty much in line with what looks like a coordinated decline in optimism across the construction supply chain.
Indeed, the effect on construction of austerity, tight finance and the cuts to public capital spending has prompted industry leaders to unite in a call to Government to help boost the industry. (see the latest in Building)
In fairness the RIBA indicator remains positive, despite its nasty downturn. But what was particularly interesting about this set of figures was what lay behind the collapse in optimism. It was, according to the more detailed numbers, down to a darkening of architects’ view of prospects in the private housing market.
The fall in the sector indicator was from +16 to -1. What makes this more unsettling is that architects had seen private housing as one of the more promising of the sectors.
Naturally this is just data from one month. Fortunes fluctuate and when you are as upstream as architects in the construction process they can fluctuate very wildly. Also the drop in confidence may be more reflective of what is happening elsewhere than in house building.
As RIBA Director of Practice, Adrian Dobson, points out: “It may be a reflection of greater competition for housing work as other sectors continue to remain challenging, or an early indicator that the private housing sector is set to decline.”
But it was also interesting to note him putting down a marker to Government in line with growing sentiment in the industry.
“The second scenario would strengthen calls from UK Construction for a more effective Government backed fiscal stimulus plan,” he said.
And so it should. If we can’t increase house building from such a low base when the need is so great, what hope is there for other sectors of construction?