4 February 2020
Construction PMI: The Tories won the election – now they need to make up their minds on infrastructure - MHA MacIntyre Hudson comments
Following the release of today’s Construction PMI, Brendan Sharkey, Head of Construction and Real Estate at MHA MacIntyre Hudson, says the greater certainty following the election result has energised the sector but firm decisions on future infrastructure are needed to cement the gains
“The conservative election victory has acted as a release valve for a certain amount of pent-up energy in the sector. Contracts left on the back burner over the period of Brexit uncertainty are finally come to fruition. Yet it is far too early to tell if this bounce will lead to a sustainable rebound or just represents a fleeting flash of confidence in a sector struggling with low margins and a lack of government investment.
“The decisions the sector would like to see the most are those pertaining to the big delayed infrastructure projects, especially HS2 but also the third runway at Heathrow. Leading companies are already heavily invested in these projects even if they are not as yet putting the forecasts for the costs of the work into their usual financial projections.
“Undertaking a major construction project is like fighting a battle; manpower and resources have to be at the right place at the right time, so they need to be organised and budgeted for well in advance. The big firms have already made assessments about how much of their workplace to allocate to the projects currently awaiting government approval and they will take a hit if the government does not give the green light.”
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