Construction Sentiment Remains High Despite Industry Frustration

Construction Sentiment Remains High Despite Industry Frustration

14/04/2021

According to an RTE report earlier this week, up to 20,000 construction workers are returning to work on construction sites around the country right now as part of a planned ‘phased reopening’ of non-essential construction projects. You can read the article in full here: https://amp.rte.ie/amp/1209212/.  The news report correctly points out that “there continues to be frustration within the industry that building work in the remaining parts of the sector that remain stalled cannot yet resume…”. Frankly, we echo that frustration and agree with Irish Independent columnist Richard Curran when he deduced that ‘Phased construction return proves expensive mistake’.  

While the McKeon Group team have been engaged on essential construction activities throughout the most recent and earlier industry shutdowns, we know that not all of our peers have been in the same position. Also, being engaged on essential projects does not diminish the unavoidable delays and loss of momentum on other, arbitrarily termed ‘non-essential’ projects. Many of these are absolutely essential to the project owners, investors, delivery teams and the end-users, not to mention the Exchequer.  

Since Monday, residential, early-learning and childcare sites have started to reopen and, as many readers here will know, reopening a construction site that has been locked up since January 8th is in itself a big undertaking. 

Public health is the number one priority and this is a priority that is shared between Government, industry and individuals – the human cost has already been too great. After the successful and industry-wide adoption of a series of HSE safety protocols over the past 13 months, the Construction Industry Federation, or CIF, has been calling on the Government to follow the science and to follow the numbers. The industry body argues that despite 40,000 construction workers being on sites daily since January, there has only been a very small number of Covid-19 cases associated with this activity. The Government’s own figures show that the incidence of workplace infection accounts for 7 per cent of all outbreaks, and only 5 per cent of these workplace outbreaks have taken place in construction settings. At this stage in the vaccine roll-out programme, it is entirely appropriate to look at the impact of ongoing industry restrictions on the wider economy. A recent EY/DKM report revealed that each week of lockdown reduces industry output by €427 million and costs the Exchequer €53 million. We hope to see all of this data reflected in the decision taken between now and May 4th.

This phased reopening of the industry coincided with the publication of the latest Ulster Bank Construction Purchasing Managers’ Index, which showed the construction sector  to be “increasingly upbeat”, despite a continuing sharp contraction in trade last month. 60 per cent of firms surveyed expect an expansion of activity over the next 12 months. Simon Barry, chief economist at Ulster Bank (Republic of Ireland) explained that the jump in confidence is “underpinned by the expectation of improved business conditions for the sector as restrictions are eased and as pent-up demand is released”. Let’s hope these expectations are met throughout 2021.

About McKeon Group

Established in 1950 and ISO certified for more than two decades, McKeon Group offers expert construction, fitout and building services. The family-run Group delivers projects, services and maintenance across a range of sectors for State, local authority, FDI and private clients. For more information, contact: www.mckeon.ie