Boom, gloom or wait and see?
June 2016

While the industry is recovering from the shock of Thursday’s Referendum vote, no clear consensus is emerging of the impact it might have and, while there is a mix of optimism and caution, the underlying theme is one of ‘wait and see’
Leading the optimists is UK Construction Week Event Director Nigel Garnett who says: “Leaving the EU will likely mean UK construction firms will be looking to invest in British products and services like never before,” and even adds that the UK has the foundation for a boom in house building and the industry must be committed to meeting the national need for housing.

“He concludes: “The last few weeks and months have been uncertain for the UK construction industry, but now is the time to embrace the change and these new opportunities.”

But if there is to be a housing boom, the Federation of Master Builders asks who will be doing the building. With 12% of construction workers of non-UK origin – mainly Polish, Rumanian and Lithuanian – FMB Chief Executive Brian Berry warns: “It is now the Government’s responsibility to ensure that the free-flowing tap of migrant workers from Europe is not turned off. If Ministers want to meet their house building and infrastructure objectives, they have to ensure that the new system of immigration is responsive to the needs of industry.”

Meanwhile, the British Woodworking Federation is focusing on ‘proactive risk management’. Iain McIlwee, chief executive said: What matters now is that door, window and other joinery firms are well informed and well prepared to assess risk. From that position of preparedness, businesses will be able to ride through the inevitable period of change ahead with greater confidence and optimism.”

He added that the Federation has created a ‘Risk Matrix, a checklist of issues for businesses to consider in their assessment of the impact of Brexit’ available to download from its website at http://bwf.org.uk/assets/eu-referendum-risk-matrix.doc

The GGF takes an open minded view on the outcome of the result. Chief Executive Nigel Rees said: “The GGF Membership can rest assured that we will continue to deliver the same level of benefits and service for our Members. In the short term, we must wait until the Party Conferences this autumn and see how the political parties shape their leadership, policies and direction going forward. There is no doubt that the implications of Brexit and the political uncertainty is already sending economic shockwaves through the construction and property sector, the scale of which may not be clear for some time and as such a tough trading climate that will impact companies both large and small is anticipated.

A similar caution of short-term disruption came from Michael Dall, lead economist at industry analyst Barbour ABI. Speaking in its latest report before the final result, had said: “If Brexit does take place this is likely to cause a significant change in outlook at least in the short term with the likelihood of a reduction in activity.” (see separate article).