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ventilation

Commercial Sector Continues To Bounce Back

State of trade survey from B&ES confirms continuing market improvement for commercial heating and ventilating sector

Business is continuing to improve for members of the Building & Engineering Services Association (B&ES), with increased order books and enquiries being reported more or less across the board, according to the latest state of trade research carried out among the membership.

The survey covers the period from January-June 2014 and also reveals growing confidence in future commercial prospects with 56% of respondents feeling positive about future prospects, resulting in the ‘net optimism measure’ rising from +35% to +49% compared with six months ago.

Improved trading conditions are reflected by a ‘welcome stabilisation’ in tender prices, but also by an increase in labour costs as skills shortages begin to increase once again. Rises in materials costs, however, were less evident than at the start of the year. In fact, 58% of respondents reported an increase in their order books – twice as many as last time – and almost half had experienced higher enquiry levels.

REGIONAL VARIATIONS

Geographically, more companies in East Anglia, East Midlands and the South West of England reported improvement in business levels than in other regions, with only firms in Northern Ireland recording a decline in enquiries and recruitment, along with static order books and turnover levels.

In terms of market sectors, firms active in service and facilities and industrial/ commercial installation were able to see the biggest improvement, although business also grew in the domestic sector, where a decline in both order books and enquiries was picked up by the previous survey.

As many as 38% of respondents were able to confirm that they were employing more people than six months ago, while 44% expected to recruit during the second half of 2014. The use of agency labour had also risen significantly as had the number of firms hiring apprentices or trainees, which showed an increase of more than a fifth.

Chief Executive, Roderick Pettigrew, pointed out that this was the third successive B&ES survey to have painted a brightening picture for building engineering services and by implication, for the construction industry as a whole. “With enquiries, order books and turnover all on an upward trend, our members are beginning to credit that a sustained and increasingly robust recovery may genuinely be on its way and the reported stabilisation of tender prices augurs well for future profitability.”

Mr Pettigrew went on to express pleasure that members are recruiting again, most significantly at apprentice and trainee level “especially in the light of the skills shortages that are already beginning to appear in many areas of the workforce”.

There was one area that had not shown such growth and that was expansion in the residential market – which the survey showed had been slower to than in other sectors and Mr Pettigrew expressed the hope that prospects in Northern Ireland would soon catch up with those in the rest of the UK.

For a fuller report on the state of trade survey, visit the website: www.b-es.org

Caption                    Chief Executive, Roderick Pettigrew, B&ES –“members are beginning to credit that a sustained and increasingly robust recovery may genuinely be on its way”. Above, a recent installation by B&ES member, Curaim UK.

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