Economic Recovery in the Construction Industry

May 8, 2020Research

Having started a bidding firm during the last recession, we understand economic recovery and confidence comes from sectors like construction and infrastructure. Glenigan have been compiling weekly evidence of economic recovery in construction, which they present on their YouTube channel, that is starting to show the first signs of positive activity in recent weeks in their short You-Tube series. Key highlights include:

  • In respect of tenders, they are seeing an average of 70 bids per day coming to market, which is an uplift of c. 10-20 per day compared with the early lockdown.  Whilst in the pre-COVID era clients were adding around 90 bids a day, this is still a good jump in recent weeks.
  • Many tenders have also been extended to allow contractors to submit bids whilst having a potentially smaller workforce. This is advantageous as it can allow time for more considered and well-priced bids which could in particular support SMEs.
  • Main contracting award decisions from tenders are also increasing, which is showing client confidence to have things lined up and ready when lockdown restrictions ease.
  • Many major construction firms are planning or in the project of re-opening sites with social distancing measures. Work resumed on 11% of the sites that were suspended.
  • Whilst the number of new sites opening fell by c. 50% this past month, there are still new projects getting started, with over 160 new ones launching across industry sectors in April.
  • More good news is that early development pipelines are still firm. Planning Applications averaged 1,331 per day, which is only down by 15% when compared to the period before the lockdown. Published decisions are also following a similar trend at 15% lower. Planning committees are also moving to more online decision making so there isn’t a backlog.

We work with a number of construction companies, both corporate and SME. If you have an upcoming opportunity that you’d like some help with, please get in touch today.

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