Sector drops into negative territory for first time since spring
Architects’ confidence in the commercial sector has dropped into negative territory for the first time since March.
It was the sector with the biggest drop in the RIBA’s latest Future Trends report, from a score of +9 in August to -2 in September.
This reinforces the sense that clients feel far more nervous about committing to new commercial projects, said RIBA executive director for members Adrian Dobson.
The forecasts for work in the public and community sectors both remained in negative territory, while private housing remained reasonably buoyant at +7.
Any figure above zero indicates an expectation that workloads will grow.
Meanwhile, London remained the most cautious region, but its gloom began to spread into the north of England for the first time.
The overall Future Trends workload index dropped to +7 in September from +11 the month before.
The gap between London and the rest of the country narrowed significantly, with the previously upbeat north of England dropping to a figure of +12, from +41 last month.
Confidence in the south of England grew a little. Medium-size practices were gloomier than those with more than 51 staff and those with fewer than 11.
Dobson said: “Commentary received from our participating practices suggests a fairly steady but highly competitive market for architectural services.
“However, a significant number of practices highlight a growing hesitancy on the part of clients to allow projects to proceed to construction. Many cite the uncertain conditions created by Brexit as the dominant factor causing clients to stall projects.
“In recent months practices in the north of England and the Midlands and East Anglia have been noticeably more upbeat than those in London and the south of England, but this north-south difference has now started to narrow considerably.”
In contrast to the workload index, the staffing index rose marginally in September from +3 to +4.
Practices in Scotland (+20), London (+9) and the Midlands and East Anglia (both +8) are the most upbeat about the likelihood of taking on staff.
Again practices in the north of England saw a significant dip in confidence: their recruitment figure fell to -3 in September, down from +11 in August.