State of the Nation: Construction Industry Q1 2024

What Is The State of the Nation Report?

We asked an audience across the UK to participate in a survey to offer insights into the state of the construction industry.

We’ve compiled these surveys within the report to provide a current breakdown of the state of the nation in the construction and built environment industries.

This blog provides a brief snapshot of our latest findings.  Get access to the full results with visual representations of The State of the Nation here. 

Business Optimism and Capacity Levels: 2024 Q1 vs 2023 Q4

When we asked our respondents about their level of optimism regarding the overall state of the UK Construction sector, the results portrayed an increase in optimism with around two-thirds of respondents feeling more positive or remaining the same.

Overall optimism within the regional level has improved since Q4, with respondents in the North West and Scotland demonstrating the highest levels of optimism.

What are the main factors limiting output over Q2 2024?

In Q4, orders were seen as the main factor which limited output in the following quarter (Q1 2024), whereas the challenge of recruiting skilled labour was represented as the most cited constraint expected in output in Q1.

The Main Constraining Factors Likely to Limit Business Output Over Q2:

• Access to skilled labour
• Planning and regulation challenges
• Orders
• High material prices

Despite some improvements being evident regarding obtaining orders for businesses since the Q4 of 2023, it is still a challenge for many.

Challenges in Recruiting Skilled Staff in the Construction Industry

Recruitment within the construction sector continues to show a mixed picture.

One-third of respondents report challenges in recruiting skilled staff, therefore demonstrating a consistency in improvements regarding recruiting skilled staff. Q4 represented 36% of reported difficulties whereas in Q3, this figure was 42%.

The proportion of respondents suggesting no difficulty in recruiting skilled staff has not changed within Q1, with 15% reporting no challenges in Q1 2024. In contrast, only 13% of respondents have located challenges in recruiting non skilled staff, particularly evident in respondents operating in Northern Ireland, North East and Wales/South-West.

 Building Materials Sourcing and Price Changes

In terms of the availability of building materials, there has been no significant change in comparison to the last quarter. However, there has been a slight decrease of 2% with the number of respondents having difficulties in obtaining materials in Q1 compared to the last quarter.

The ease of sourcing UK-manufactured and imported materials has remained consistent. In terms of pricing, during Q1, 58% of respondents stated higher prices of UK-manufactured materials, whereas 63% reported higher prices for imported goods, in comparison to the previous quarter. This trend follows the same pattern as the previous report, which demonstrates that prices continue to rise for several respondents.

What Will Help Construction Businesses Grow Over the Next 12 Months?

Regarding business growth, we asked our respondents which factors they believe should be implemented with a result of business growth in the next 12 months.

• Cost reduction
• Economic stability
• Planning reforms
• Regulation processes
• Access to skilled labour, training and education
• Improvements in Government and policy

State of the Construction Industry Q2 Results

In terms of Q2 Results, our team of researchers are currently conducting the research and reviewing the results for this quarter.

Understand the state of the construction industry as well as the built environment landscape as told by real industry professionals throughout the UK.

Sign up today to receive your State of the Nation report to receive Q2 results.