Contractors in Northern Ireland predict tender price growth in 2018 as skills crisis deepens

Contractors in Northern Ireland are forecasting that tender prices will increase in 2018 as competition for skilled labour increases cost pressures.

Contractors in Northern Ireland are forecasting that tender prices will increase in 2018 as competition for skilled labour increases cost pressures.

According to the Northern Ireland market intelligence survey from leading professional services company, Turner & Townsend, surveyed contractors believe that tender prices are set to increase from 1.6 percent last year to 2.3 percent in 2018.

Tender price inflation is being driven by a deepening construction skills crisis which is being exacerbated by Northern Ireland-based contractors searching for more profitable work in the Republic of Ireland and Great Britain. 

The research reveals that on average 61 percent of surveyed main contractor workloads are based on work outside of Northern Ireland.

Order books for contractors in Northern Ireland have improved in the first quarter of 2018 when compared to previous quarters. Contractors report strong order books which are on average 65.8 percent full for 2018/19.

In contrast, fit-out contractors are reporting a lacklustre market with order books on average only 17.8 percent full  for 2018/19.

Colm Lavery, Director, Real Estate and Strategic Lead commented:

While the UK Government has tabled a budget for Northern Ireland amid the current powersharing impasse, funding is not confirmed and there remains a lack of clarity for the construction industry. Some contractors are very bullish about tender price growth and it remains to be seen whether the market will keep pace with these forecasts.

“There remains a reluctance from some contractors and their supply chains to tender for work in Northern Ireland, which is draining the labour pool and increasing competition for resources."

“Against this backdrop, it is vitally important that clients carefully consider their contract and procurement strategies to attract contractors to their projects and also play their part in addressing the industry-wide skills deficit.”

For further information, contact:

Colm Lavery

t: +44 028 9044 6999
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