From the desk of: Gordon Best, Regional Director, QPANI
With one election behind us and another one to look forward too, although given the current deadlock over welfare reform no one can be sure when that Assembly election will happen, the frustrations within the wider Construction family continues to grow.
Given the uncertainty and paralysis of decision making at the Executive and Assembly the industry is finding it extremely difficult to build some momentum and help boost the economy. For QPANI members, and for that matter any business, who plan and invest long term confidence in the economy and political leadership is vital.
The 2014 Q4 NI Construction bulletin did give some indication that the green shoots of recovery were taking hold indicating the total volume of construction output in Northern Ireland in the final quarter of 2014 increased by 3.9% compared to Q3 2014 and was 7.0% higher compared to the same quarter in 2013. The volume of construction output in Q4 2014 was the highest level of output reported for almost two years.
One positive sign is the rate of activity growth in the Irish construction sector gathered speed again in May, returning to the pace seen in the final quarter of 2014. Seasonally adjusted index designed to track changes in total construction activity increased for the third month running in May, posting 63.3 from 57.2 in April. The reading signalled the sharpest increase in activity since November last year, with the current sequence of monthly expansion now extended to 21 months in the Irish Republic.
In comparison the Ulster Bank PMI survey for May showed that Northern Ireland’s private sector reported the fourth monthly decline in activity in five months in April. The latest decline, although modest, confirms that Northern Ireland’s private sector recovery has effectively stalled since November last year. Furthermore, Northern Ireland’s modest decline in private sector activity compares with positive growth in all of the other UK regions. According to Richard Ramsay of the Ulster Bank the fall in business activity was due to steep declines in construction and retail.
The recent statement of concern from the Construction Industry Group ( CIGNI ), fully endorsed by QPANI members, said it straight. Speaking on behalf of its members, CIG Chairman Stephen Kane said: “We find ourselves in an extremely serious situation whereby the Northern Ireland construction industry, and the people working within in it, face a very bleak future if the Assembly fails to implement the Stormont House Agreement and agree a sustainable, deliverable budget for Northern Ireland.
“With a turnover of £2.18 billion in 2014, the local construction industry is of major importance to the wider Northern Ireland economy and delivers a number of significant multiplier effects. In terms of employment alone, 66,000 people currently work in the industry, representing almost 10 per cent of the working population in Northern Ireland.
“Furthermore, research from Ulster University estimates that for every 10 jobs created or sustained in the local construction industry seven further jobs are supported in the wider economy – so the impact on the NI labour market is indeed far reaching.
“However, a serious lack of public investment in capital projects, infrastructure and maintenance in Northern Ireland, when coupled with a paralysis on decision making by the Executive, means that the pipeline of constructionrelated work is rapidly drying up and the industry simply cannot support these jobs.
“We also need our politicians to take action to facilitate the growth of private investment that will see a reduction in the dependency of the construction industry on public funding – thus meeting the Programme for Government target to rebalance the Northern Ireland economy. Failure to do so will have catastrophic implications for the local construction industry and the wider Northern Ireland economy.”
In support of these statements, QPANI added its voice. The future of so many businesses and the hopes of our young people depend on our elected leaders reaching agreement on a future budget and on welfare reform. The current impasse is creating unequalled levels of uncertainty, redundancies and suspension of investment decisions within the construction supply chain. In fact a number of local contracting firms whose turnover in GB now exceeds that of their work in NI are now considering moving their main office facilities to Britain. It is sad that the innovation, skills and products of our suppliers are in greater demand outside of these shores rather than at home. The responsibility for this lies fairly and squarely with those political parties who ignore the financial realities of life and put political interests ahead of supporting hard working people and businesses.
On other matters QPANI have thrown their weight behind the Cold Water Safety Strategy which aims to tackle the issues of trespass and drownings in disused quarries and reservoirs. DOENI recently confirmed that the Safety Strategy face book page had received over 60,000 hits and was growing.
As ever QPANI continue to work hard to protect the interests of the Industry. I would like to thank all of our Members for your continued support. May I also take this opportunity to appeal to those readers who are not currently QPANI members to consider joining and supporting the work that protects your business. Just give us a call at the office on 02890824078 or email me on firstname.lastname@example.org