Is it all doom and gloom?
Our RIBA expert gives advice to a worried architect who is pondering the gap between economic statistics and commercial reality
Question: I keep reading that the construction industry shows no sign of improvement and that next year will be no better. What does this mean for my business, as all the architects I know are reasonably busy?
Answer: All the current forecasts for UK construction do seem to be getting gloomier.
The Construction Products Association recently downgraded its predictions for construction turnover in the UK to a 6.3% shrinkage in 2012 and a further 1.4% decline in 2013.
The RIBA Future Trends survey for September 2012 shows professionals also predicting a further decline of workload over the next six months. Overall the UK construction market has declined about 35% since its end-of-2007 peak, after which it went into freefall for two years and has been bumping along the bottom ever since, even with the Olympic effect. We are now into our third mini-dip since 2009, with little sign of uplift until 2014 or later and no return to the 2007 peak until about 2018-20.
But you know what they say about “lies, damned lies and statistics”. You need to take an analytical view of this data, from your own perspective.First, the overall statistics are averages that hide many variations between sectors and regions. There are areas of expansion. Maybe the busy architects you know are in these continuing “up-side” markets, either by luck or by clever design.
While the UK and EU markets are in the doldrums, the rest of the world is expanding and your busy friends may be exploiting those international markets.
The overall global construction market is predicted to grow from £5 trillion in 2010 to £8.5 trillion in 2020, but nearly all of that growth will be in the developing markets of Asia, South America and Africa.
What this means for your business is that to survive, let alone grow, you need to be where there will be growth and work opportunities. If you haven’t already done so, you need to do a critical audit of your unique skillset and experience, then look at how they could be applied to the new opportunities you would like to take. This will mean getting hold of as much economic data as you can in the specific areas that interest you, and then seeing how you can apply this information to your business.
For you, this may mean doing things very differently from your competitors and colleagues — maybe starting to look to work internationally or moving your marketing focus to new and growing sectors, where you can more easily transfer your skills and break into a new market.
You will need one more ingredient: a large pinch of salt to throw over your left shoulder at the unhelpful statistics of averages — and for good luck.
Disclaimer: This column is for general information only. It should not be relied on or treated as a substitute for specific legal advice relevant to particular circumstances. Neither BD nor the contributors’ employers accept any responsibility for the personal views expressed in this section.