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Civil engineering contractors say that their workload was marginally down in the first quarter of 2018, overall, but orders were up.

The Civil Engineering Contractors Association’s workload trends survey for 2018 Q1 in Great Britain suggests things are looking up, therefore.

Overall, 28% of the respondents reported that workloads had fallen compared to a year ago, and 44% of the respondents reported that workloads were unchanged.

For England, only 9% of firms, on balance, reported an increase in workloads in Q1, down from 21% in Q4. In Wales, after reporting a negative balance (-33%) in Q4, workloads increased according to 47% of firms, on balance. However, in Scotland, workloads declined for a second consecutive quarter in Q1, according to 38% of firms, on balance. This was the weakest balance since 2010 Q1.

However, order books are as strong as they have been for three years, with 44% of firms reporting that orders had increased compared to a year ago and 35% of firms saying that they were unchanged.

In England, 55% of firms reported that orders had increased and 28% reported that they were unchanged. The net balance of 38% of firms reporting an increase in orders, up from 13% in the previous quarter, was the highest since 2015 Q1.

Welsh contractors reported a negative balance of -6% for orders in Q4 2017 but the start of 2018 saw a turnaround, with a balance of 46% of firms seeing orders increase.

For a second consecutive quarter, orders in Scotland decreased, on balance, according to 3% of firms. Overall, 34% of firms reported that orders had declined.

CECA chief executive Alasdair Reisner said: “2018 has seen challenging market conditions in the UK’s infrastructure sector, where the aftershocks of the Carillion liquidation continue to be felt. We believe there is more the government can do to support the sector, by committing to projects outlined in the National Infrastructure Delivery Plan and continuing to develop this pipeline to secure economic growth.

“At the same time, our members are reporting that they are expecting orders to turn into activity, as schemes come forward to market in the coming year.

“While the first quarter of 2018 has proved a challenging period for many of our members, we believe that there is light at the end of the tunnel, and that industry will act as a platform for secure growth in the coming years.”

The CECA survey does not include Northern Ireland.

Article courtesy of  ‘The Construction Index’ 

Laing O’Rourke has recorded the lowest inequality in pay between men and women among Britain’s top 30 main contractors.

Network Rail’s CP6 programme is looming into view while several CP5 projects continue to make the headlines.

Midland Main Line

Midland Main Line upgrade_Network Rail_Masts installed between Kettering and Corby

Midland Main Line electrification was first proposed in the 1970s, yet only the London to Bedford section was completed before the scheme was ditched in the following decade.

Interest in electrifying the Midland line gradually returned, driven by its potential to cut costs, reduce emissions and improve train performance. However, in 2009 the then transport secretary Lord Adonis decided to prioritise the Great Western Main Line, with the Midlands Main Line kicked into the long grass once more.

In 2012 Conservative transport secretary Justine Greening announced funding had been released for the scheme as part of a wider £4.2bn “rail revolution”, but the project was paused in July 2015 by her successor Patrick McLoughlin amid reports of missed targets and cost overruns.

After restarting three months later, the project ran into further difficulties in July 2017 when transport secretary Chris Grayling scrapped electrification on the lines to the north of Kettering and Corby. Instead, bi-mode trains – electro-diesel locomotives – will be used on this part of the line to avoid “disruptive” electrification works.

Carillion had been the main contractor for the London to Corby route of the scheme, and its collapse in January saw work grind to a halt. After weeks of uncertainty, it was announced last week that Amey had picked up the contract and Carillion staff working on the project will be transferred to Amey.

Waterloo station

network rail waterloo 1

Waterloo was buckling under the pressure of accommodating for a 100 per cent increase in passenger capacity in the past 20 years, prompting Network Rail to invest £800m to improve and increase capacity at the station.

In April 2016, Aecom, Colas Rail, Mott MacDonald and Skanska scooped a £453m contract to transform Waterloo International Terminal and deliver platform modifications elsewhere in the station, with Skanska’s part of the scheme worth in excess of £165m.

In August last year, platforms one to four were extended to allow train operator South Western to run 10-carriage trains along the tracks from December. Platforms 20-24 will be brought back into use, platforms five and six will be shortened and the end of platforms seven and eight will be narrowed.

The revamped Waterloo International Terminal is due to re-open in December 2018.

TransPennine upgrade

network rail transpennine route upgrade map

This scheme will see journey times across the North from Newcastle, Hull and York towards Manchester and Liverpool via Leeds reduced while enabling more frequent services.

However, the project is currently at a standstill while it awaits the necessary government backing, despite contractors having been announced for the works.

In March 2017 Construction News revealed that an Amey / Bam Nuttall joint venture will deliver works to the west of Leeds, with a Murphy / Siemans alliance overseeing the programme east of Leeds.

Potential infrastructure options for the route have been submitted to the Department for Transport for consideration.

Network Rail chief executive Mark Carne revealed at the CN Summit last year that he expected the TransPennine upgrade to begin in Control Period 6 – the next funding round from 2019 to 2024.

It was confirmed in February this year that Network Rail has earmarked funding for the scheme to be delivered in CP6, though the JVs are still awaiting a precise start date.

Great Western Main Line

network rail western trackworks

The Great Western Main Line’s electrification has been plagued by difficulties since it was first announced in Network Rail’s 2014-18 rail investment programme.

In September 2014, it was estimated that electrifying the route between London and Cardiff would cost £1.6bn. However, Network Rail bosses were hauled in front of MPs on a public accounts committee in November 2015 to explain why the programme’s budget had spiralled, with chief executive Mark Carne admitting it could cost between £2.5bn and £2.8bn.

A year later, four projects within the overall Great Western programme were put on hold until CP6 – namely the electrification of lines between Bristol Parkway and Bristol Temple Meads, Bath and Bristol, Henley and Windsor, and Oxford and Didcot.

Then in July 2017, transport secretary Chris Grayling reduced the scope of the programme by announcing that Cardiff to Swansea would not be electrified.

East West Rail

network rail east west rail phase 2 map 1

This scheme envisages a new railway between Oxford and Cambridge to improve connectivity between the east and west of England.

Three phases have been set out for the work: western, central and eastern.

Section one of the western phase was completed in December 2016, with an updated connection built between Oxford and Bicester village. Section two of the western phase will upgrade and reconstruct routes between Bicester to Bedford, and is currently at consultation stage.

In December 2015 Atkins, Laing O’Rourke and VolkerRail were picked to design and construct the central phase, which covers works between Bedford and Cambridge.

The following summer saw the selection of a preferred geographic corridor for this leg of the route. Possible detailed route options continue to be considered, with construction works potentially starting in the mid-2020s.
Article Source: Construction News

Construction will be the worst affected major industry following Brexit, according to a study commissioned by mayor of London Sadiq Khan.

The report, produced by data analyst Cambridge Econometrics, looked at the effects on trade, investment and labour on different sectors of the UK under four different Brexit scenarios.

Under the ‘softest’ Brexit scenario, in which the UK leaves the customs union but remains in the single market to retain free movement of goods and people, construction’s contribution to total UK GDP would decline by 3.5 percentage points – the biggest decline out of any sector, the report found.

In the event of the ‘hardest’ form of Brexit – no transition deal, no membership of the customs union or single market, and trading under World Trade Organisation rules, the industry’s contribution would fall by 8.2 percentage points – with only agriculture’s share facing a bigger fall.

Arcadis market intelligence lead Will Waller said: “It confirms a lot of what we all fear.”

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He added: “We’ve done quite a bit on the ‘hard Brexit’ scenario and for construction it would be really bad news.

“The industry needs to be pushing hard to make the government aware of this.”

Cambridge Econometric attributed the industry’s potential decline to difficulties in acquiring labour; the knock-on effect of a slowdown in the wider economy; exposure to non-tariff barriers, such as quotas and trade licences on imports and exports; and falls in investment.

The data analyst said: “Once the UK leaves the single market, it is likely that the skills shortage could get worse if the new agreements don’t allow for free movement of people.

“This could result in even higher pressures on wages as labour supply contracts, causing construction firms to face considerably higher project costs.”

The report also highlighted that the UK had benefited from €7.8bn of European Investment Bank investment in infrastructure projects, and that SMEs received €666m in European Investment Fund loans during 2015 alone.

The country will lose access to both of these funding sources after Brexit, the study noted, which could “significantly impact the ability of firms to deliver big infrastructure projects such as HS2 and reduce development opportunities for start-ups”.

RICS London policy manager Abdul Choudhury said: ”The UK Government must act promptly to keep EIB funding or introduce a new lender, or lending mechanism, to plug the gap created from the potential loss of EIB funds, particularly for shovel ready projects that are of great importance to London.”

Mr Waller notes that Cambridge Econometics have been forced to make many assumptions in its work, and others are sceptical of its reliability.

CPA economics director professor Noble Francis said: “Forecasting the next 12-18 months is challenging enough given the uncertainties around so Cambridge Econometrics attempting to forecast the effect of a hard Brexit on the economy and construction in London by 2030 is dubious to say the least.

”According to the research, overall impact of a hard Brexit would be a 3% hit to the economy by 2030 but the margins of error must be greater than that.”

Mr Waller also noted that there were threats to construction that were not covered clearly in the report which also needed to be addressed.

“Just disruptions in customs could lead to practical delays in delivery of materials,” he said.

“So we’re all going to have to think about our projects in terms of: do we need to change our procurement, do we need to stockpile materials. And that planning needs to start now.”

He suggested that one possible silver lining could be a decline in commercial construction freeing up the supply chain to put more resources into housebuilding.

The mayor of London said the report emphasised the risks the country faced and called on the government to do more to avoid a hard Brexit.

Mr Khan said: “If the government continues to mishandle the negotiations, we could be heading for a lost decade of lower growth and lower employment.

“The analysis concludes that the harder the Brexit we end up with, the bigger the potential impact on jobs, growth and living standards.

“Ministers are fast running out of time to turn the negotiations around. A ‘no deal’ hard Brexit is still a very real risk – the worst possible scenario.”

As the year draws to a close and we look forward to the Christmas break it’s a good opportunity for us to reflect on 2017 and what the jobs market will have install for us in 2018.

It has been a very busy year for Intersect Global.
Demand for both permanent and contract staff has been strong and the skill shortages our industry faces have continued to become increasingly apparent and challenging.

As Crossrail’s completion date draws closer other major projects such as HS2 and Hinckley Point will increase in activity and it will be interesting to see how employers cope with their recruitment needs.

Its seems like significant changes are on their way for the contract workforce operating in the private sector, by way of changes to taxation.
Having recently attended a consultation meeting with HMRC on this matter it appears that industry has 18 – 24 months to prepare its self.

Here is a quick summary of the latest results from Jobs Outlook:

53 per cent of employers would have to take action if the recent budget introduces new measures which would increase their staff costs because of changes to taxation such as IR35, and one third of employers would have to increase their prices,

The latest Jobs Outlook survey of 600 employers also shows:
• 42 per cent of respondents expressed concerns that not enough permanent workers would be available to meet their demands and 40 per cent say the same for temporary agency workers.
• 80 per cent of employers say they have none or just a little spare capacity in their organisation to take on more work without new staff.
• 22 per cent of employers still plan to hire additional permanent staff in the next four to 12 months.

We would like to thank all of our clients, candidates and suppliers for their continued support and would like to take this opportunity to wish you all a Merry Christmas and a Happy and Healthy New Year.

Former home secretary Lord Blunkett has vote to force the government to “pull its finger out” on skills to prevent a labour shortage for the UK’s major infrastructure projects.
Speaking to Construction News, the Labour peer said the government must get colleges and education providers “geared up” to offer the construction skills needed for projects such as HS2 and the expansion of Heathrow.
“If we don’t plan now to get the careers advice in place at schools and get apprentices increased we are going to be in real difficulty,” he said.
On the prospect of Brexit, Lord Blunkett said the situation “adds a real urgency to the immediate future”.
Arcadis has estimated that UK construction could lose up to 215,000 workers by 2020 under a hard Brexit.

The Labour peer added: “Either we get our act together with diversity, with women, with people who have been unemployed for a long time coming back into workforce, or we end up with a massive shortage.”

Lord Blunkett, who also served as education and employment secretary in Tony Blair’s government, warned:
“We could end up putting the work out for other countries, which in my view would be a catastrophic outcome.”
The Labour peer, who is chairman of the Heathrow Skills Taskforce, was speaking to coincide with the launch of an online forum to gather views on the airport’s future education, employment and skills strategy.
Four logistics hubs are expected to be set up by Heathrow across the country to create 180,000 new jobs, including 10,000 apprenticeships, as part of the airport’s proposed expansion.
As part of his role on the taskforce Lord Blunkett has also met leaders from other major infrastructure projects, including Tideway, HS2, Crossrail and Hinkley, to discuss tackling the skills strategy.

“It’s clear we’re all in the same boat trying to plan ahead for major investment and skill shortages,” he said.

“What we hope to do is time the requirement for particular skills in such a way that people can transfer from one major project to another.”

On the government’s new T-Levels, designed to give parity to technical qualifications, Lord Blunkett said they are a “contribution” but added “unless they are actually implanted very quickly they are going to be behind the timeline”.

He added: “Part of the job of the taskforce is to persuade the government to pull its finger out and make this part of the follow through from the industrial strategy green paper.”