Consultant says 2024 will be bottom of current cycle

Measures relating to the Building Safety Act are slowing down economic recovery, according to Arcadis. 

The consultant’s latest market review said the requirements for higher risk residential projects, such as second staircases, are expected to add at least three months to procurement and approval processes. 

This could mean any recovery of work on site could be delayed until at least the second half of this year. 

A clearly signposted open door at the bottom of a flight of stairs with a fire extinguisher next to it

Source: Shutterstock

New regulations covering residential schemes will put the brakes on recovery, the consultant said

New orders are at their lowest ebb since the depths of the covid lockdown four years ago this month but Arcadis said 2024 will mark the bottom of the current cycle.  

Low inflation is expected for construction for the next two years, while a “k-shaped” trend is anticipated for infrastructure, with weakening demand for transport projects contrasting with substantial growth in networks serving power and water as energy transition requirements ramp up. 

Workloads are currently varied across the UK, with the North-east and Yorkshire and Humber as standouts. 

Scotland, the East and West Midlands were all forecast a challenging 2024.  

Simon Rawlinson, head of strategic research and insight at Arcadis, said: “Markets are following our predicted path with falling output and low order volumes, indicating the bottom of the cycle in 2024.  

“Although long-term prospects are improving, the commercial and residential sectors face significant headwinds. Our central case remains low inflation, not deflation.”  

Ian Goodridge, market intelligence lead at Arcadis, added: “Looking at the workload, the North East and Yorkshire and the Humber show the strongest performance, driven by robust infrastructure activity.  

“However, the South-east remains a soft spot. Orders have seen a year-on-year reduction exceeding 10% in almost all regions, with London and the South-east experiencing declines surpassing 20%.”