Construction Outlook In NI Expected To Stabilise

The Northern Ireland construction industry has gone through one of its most difficult economic periods and after five years of steep decline, construction output in Northern Ireland (NI) is expected to stabilise in 2013 with small levels of growth anticipated from 2014 onwards.

The Construction Skills Network (CSN) report for Northern Ireland 2013- 2017 is the industry’s annual skills forecast prepared by ConstructionSkills (the Sector Skills Council for Construction) with input from Construction employers and stakeholders across Northern Ireland.

Over the five year period to 2017, output is forecast to grow at a modest annual average rate of 1.7%, a stronger growth rate than for the UK as a whole (0.8%). However, Northern Ireland has experienced a much steeper decline than the UK as a whole in the five years to 2012 (37% compared to 16%) and is therefore coming back up from a much lower base. The private housing sector has been by far the worst performing sector in the NI construction industry in recent years, having contracted by nearly three quarters since its output peak in 2006.


Whilst construction output is expected to start to rise again from 2014, construction employment is expected to continue to decline until 2016 due to the normal lag between changes in output and employment levels. However the lag is believed to have widened due to the relatively high levels of underemployment or excess capacity which currently exists within the industry. This underemployment will need to be used up once industry gets back to a growth path before employment starts to rise. Therefore on an annual average basis, the decline in employment is expected to be around 1.5% over the five year period to 2017.

Recruitment to the industry is predicted to be an average of 660 per year from 2013 to 2017, considerably lower than last year's forecasts. Weakening levels of demand for construction services has meant the recruitment requirement will be solely to fill vacancies created by those leaving the sector.

Barry Neilson, Chief Executive, CITB-ConstructionSkills NI, said: "2012 was a tough economic year for the local construction industry, public spending cuts and lack of investment in the private sector have resulted in many companies ceasing trading and others turning to markets outside of NI for work. Whilst the forecasts suggest a slight growth from 2014, the construction sector seems a long way from the output levels seen at the recent height of construction activity in 2007, and it is unlikely we will see those levels of activity return for a very long time."

(CD)