Brexit Backlash: What rising material costs mean for construction
The cost of materials for British construction companies have increased in recent months and could be set to rise further as the start of Brexit talks threaten to drag the pound down and ramp up the price of imports to the UK. But it’s not all doom and gloom for the construction sector.
The Bad News…
Manufacturer EEF recently flagged up higher costs in its survey of 281 senior executives. In the report, the EEF said: “Companies have experienced a surge in input costs, which soared to multiyear highs. As the weak pound is expected to prevail, cost pressures will be gradually feeding through into higher consumer prices in the year ahead.”
Separate research by the Federation of Master Builders found 70% of the 232 UK construction companies it polled had recorded an increase in material prices owing to the pound’s fall since the Brexit vote. A quarter of all materials used by the UK construction industry are imported – this is significant and underlines the vulnerability of the industry to sudden fluctuations in the strength of our currency.
Rebecca Larkin, a CPA senior economist, said: “The impact of Brexit on the construction industry is, as yet, unclear, but it is unlikely that this year will be as buoyant as last unless the government is able to provide greater certainty and the industry is able to manage cost pressures.”
The Good News…
Despite construction companies worries about the increasing prices of materials and with big questions over what kind of trade deal the UK would end up securing, many were generally hopeful of better sales this year and were still investing in productivity improvements.
Another silver lining to this seemingly dreary news is that we have not increased any of our leading solutions for the construction and agricultural sectors. Our products are competitively priced to ensure you get the best deals.
Where to go for advice?
We’re one of the UK’s leading providers of drainage and civil solutions to the construction and agricultural sectors, also focusing on sewage treatment installation, rainwater harvesting, stormwater attenuation, farm/industrial buildings alongside civil engineering projects.
Please get in contact – 0121 351 3230.