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A rise in projects starts during the first quarter against the closing months of 2015 points to a brightening outlook for industry workload over the coming months.
The latest Glenigan Index shows that the value of work starting on site in the three months to March was 5% up on the preceding quarter, although 13% lower than a year ago in the three months to March was 13% down on the same period of a year ago. This improvement on the performance in recent month is evidence that industry workload is stabilising after the disruptions seen over the winter.
Furthermore the development pipeline is continuing to strengthen, with the value of work securing planning approval in the first quarter 9% up on a year of planned projects, driven by an increase in private sector schemes. The development pipeline of private housing, industrial and office projects are particularly strong.
“Private investor confidence will be key. Near term we anticipate that some private sector investors will defer their final commitment to proceed with planned projects until after June’s EU referendum.
Nevertheless we anticipate that the strong private sector development pipeline expected to boost tendering opportunities over the coming months as clients’ line up work to start in the second half of the year.
Accordingly while the impending vote is likely to dampen project starts in the near term, the second half of 2016 could see a sharp rise in activity as private investors press ahead with projects once the issue of EU memberships has been resolved.”
Many of those areas worst affected at the turn on the year by the flooding and water logged ground have seen the sharpest turnaround in project starts. The North West, West Midlands East of England and Scotland all saw a double digit growth in the value of projects starting on site during the first quarter.
Reproduced by kind permission of https://www.glenigan.com
Industry Accident Statistics 2001-2015
Latest UK industry figures have shown a dramatic drop in reportable accidents over the last 15 years, strengthening the electrical contracting sector’s reputation for safety in the workplace.
The 2015 Survey of Accidents at Work Report, published by the [Joint Industry Board] JIB, found that the accident incidence rate (AIR) for RIDDOR-reportable accidents is now only 16% of what it was in 2001, and has halved since 2010.
JIB and ECA members submitted data for the survey, which analyses deaths, injuries and over seven-day accidents. Slips, trips and falls and manual handling continue to be the most prevalent types of serious injury, with no fatalities reported.
In total 33 accidents were reported by companies employing 31 or more operatives. This year, the survey also gathered separate statistics from companies with 30 or fewer operatives.
ECA Director of Business Services, Paul Reeve, comments: "The huge drop in accidents since 2001 is a remarkable achievement by everyone involved in the industry, and marks a real step change in performance.
“Yet, in reflecting on this long-term success, we should not forget that serious accidents are still recorded. We should now focus on eliminating the root causes of these types of accidents, to achieve even further improvement in the next few years."
Article reproduced by kind permission of JIB.
Forecasters have lowered construction growth predictions for this year [in the UK] from 3.6% to 3% as fears mount about growing headwind for the industry.
The Construction Products Association has cut its forecast for the third time in nine months amid concern of a deepening global slowdown, the impact of the EU referendum on investors and skills shortages.
Even with these taken into account construction can look forward to around 3%-plus annual growth over the next few years, with infrastructure work expected to soar 57% by 2019, if Government can keep its spending plans on track. CPA spring forecast highlights:
- Construction output is forecast to rise 3.0% in 2016 and 3.6% in 2017
- Private housing starts expected to rise 5.0% in both 2016 and 2017
- New offices activity anticipated to increase 7.0% in 2016 and 6.0% in 2017
- Retail construction expected to fall 1.0% in 2016 and only rise 2.0% in 2017
- Warehouses activity forecast to increase 23.7% by 2019
- Infrastructure work is anticipated to rise 56.3% by 2019
Professor Noble Francis, economics director, said: “The latest forecasts for construction are still positive.
“With growth of 3.0% in 2016 and 3.6% in 2017, activity in the construction industry is expected to outpace growth in the wider UK economy.
“The risks to this growth, however, continue to rise. UK economic growth forecasts continue to be downgraded in light of poorer global economic growth prospects.
“In addition, the months leading up to the EU referendum in June will inevitably see a drop off in investment as increased uncertainty leads nervous investors to adopt a ‘wait and see’ policy until the referendum is out of the way, which could have a significant impact on UK economic growth and the construction sector in particular. ”
Despite substantial risks, the CPA anticipates growth in the three largest construction sectors; private housing, commercial and infrastructure.
It said: “Private housing starts are forecast to rise 5% in 2016 and 2017, with major house builders keen to take advantage of high demand for home ownership and government policies that attempt to deal with issues around affordability.
“After a spike in property transactions in Q1 owing to April’s increase in stamp duty for buy-to-lets and second homes, however, don’t be surprised to see a fall in property transactions in Q2. That shouldn’t affect the general housing market medium-term, as the return on investment in property remains considerable.”
Work in the commercial offices sector is forecast to grow by 7% this year and a further 6% in 2017 due to major developments in the pipeline, not just in London but also Birmingham and Manchester.
But retail construction is expected to fall 1% this year and only rise 2% next year as major supermarket chains consolidate, focusing more on small convenience stores where sales margins are higher.
The shift away from high street shopping to the internet will continue to drive industrial warehouses construction, expected to increase 10% this year and a further 5% in 2017.
Francis said: “Infrastructure work is forecast to rise 56.3% by 2019 due to growth in rail, energy, roads, water and sewerage; however, there are key issues in the medium-term.
“The most pressing issue is whether the wider construction industry actually has the skills available to deal with double-digit growth in the infrastructure, commercial and private sectors at the same time.
“By 2019, total construction output is expected to be £20bn higher than in 2015, yet employment in the industry remains 324,000 lower than it was over seven years ago. If the growth we have forecast is to be achieved then the serious issue of skills shortages needs to be addressed.”
By Aaron Morby
Article reproduced by kind permission of Construction Enquirer.
Network Rail Considering Selling Power Assets
Network Rail has taken the first step towards seeing if there is interest in buying its power assets from the industry.
A consultation document released last week could see Network Rail’s thousands of miles of overhead lines and 120 substations being leased or sold to private firms.
Network Rail said the decision to test the electrical power assets was designed to “maximise commercial opportunities and inject private capital into the railway to help fund investment”.
The state-owned company is looking at new ways of increasing revenue in order to plug its £42bn debt.
Cables Failing To Comply
Cables are being offered for use, and in some instances installed, that fail to comply with standards they claim to meet, the Approved Cables Initiative (ACI) has warned.
ACI was set up to highlight the dangers of unsafe, substandard, non-approved and counterfeit cable to the cable supply industry. Working with the Health & Safety Executive and Trading Standards, the ACI reports issues of substandard cable for further investigation and follow up.
The organisation says it continues finding evidence of cables being used and offered for use in UK fixed wiring applications that claim to meet UK Wiring Regulations (BS 7671) or other standards but do not comply when tested.
ACI urges cable purchasers and users to be vigilant over the problem.
Offshore Wind Farms
All 48 wind turbines at the 144MW Westermeerwind wind farm, developed in the shallow waters of IJsselmeer in the Netherlands, have been installed.
The wind farm is now being tested before it is connected to the grid. The project has taken a year to complete.
In the German North Sea at Dong Energy’s 582MW Gode Wind 1 & 2 offshore wind farm, CT Offshore completed its installation of inter-array cables.
The company said its new purpose-built subsea trencher was able to sucessfully bury all of the 97 cables.
Steady Growth Predicted For Construction Industry
The construction industry can look forward to three years of steady 4% growth in construction output, the Construction Products Association has forecast. The Association represents manufacturers and distributors of construction products and materials in the UK.
Professor Noble Francis, economics director, said: “The key fundamentals for the sector are generally positive and construction growth is set to be more balanced."
Slowing growth in the UK economy has meant that economists have ticked down construction growth forecasts for this year from 3.8% to 3.6%.
Major projects, however, like Hinkley Point C nuclear power station, HS2, and the London super sewer are expected to drive the industry along after that with an expected 4% average annual growth level.
Hinkley Point C Delay
A final investment decision on the long-awaited Hinkley Point C nuclear power plant in Somerset could be delayed by another year, it has been claimed.
The comments come from Lord David Howell who was Energy Secretary under Mrs Thatcher. In the early years of the Coalition Government, Lord Howell was also a Foreign Office Minister.
Lord Howell believes the likelihood of EDF, which is French state-owned, giving final approval to the project is "very iffy indeed".
Last month EDF said that they were in the final steps to enable the full construction phase to be launched very soon.
Hinkley Point C will be the first in a new generation of eight nuclear reactors.
Railway Cable Thefts Decrease
Railway cable thefts over the last five years have decreased by 93%, according to new figures released by Network Rail.
Data in the organisation’s latest report, National Performance Affecting Cable Theft Impact Summary, shows that total delays caused by cable theft decreased by 88% from 344,685 minutes in 2011-12 to 41,865 so far this year.
Following a spike in cable theft five years ago, a number of preventative measures were put in place. This included British Transport Police using the Network Rail helicopter, CCTV, trembler alarms, forensic marking, and better security at depots and lineside.
The railway running beneath London – Crossrail – has been named as Elizabeth Line in honour of the Queen.
London mayor – Boris Johnson – with the monarch visited Bond Street station recently where the line’s name was revealed.
Given the Queen's long association with UK transport, Transport Secretary Patrick McLoughlin, who was also at the event, said the name was "very fitting".
The Queen also viewed part of the tunnel and met construction apprentices at the construction site which is 28m (92ft) below ground.
Images from Tottenham Court Road and Queen Elizabeth Line (Rick Crowley) by permission of TFL London. Image of Hinkley C Nuclear Point (David Rogers) under the Creative Commons Licence.
Delayed Payments Still Causing Concern
Delayed payments continue to be a major cause of concern for businesses providing building services, new industry research has found.
The overwhelming majority of responders to the Electrical Contractors' Association (ECA) survey indicated that in the final quarter of 2015 they were not always paid within 30 days. These payment terms are widely understood to be good practice in the sector.
Only 8% of contractors said that all public sector work was paid on time during this period. In the private sector, this figure was even lower with just 6% of respondents saying they had received payment within 30 days.
The survey also found that eight out of ten building and electrical services firms had increased their turnovers in the period. Specialist areas which enjoyed the most growth included: data communications, audio visual systems, fire and security, systems, and building energy management systems.
The research was produced in association with Scolmore.
Future Wind Turbines Likely To Be Higher Than The Gherkin
Wind turbines higher than London’s Gherkin are likely to be more common in future, according to a global power engineering specialist company.
K2 Management consultants believe that new manufacturing techniques will mean turbine heights are likely to soar up to 170 metres in the coming years. This is almost as high as the Eiffel Tower and taller than the BT Tower.
Over the last decade turbines have grown steadily in height as operators seek stronger wind speeds higher up.
A MW turbine located in a forest, for instance, with an average wind speed of 6 metres per second will meet 13% more wind speed if the turbine height doubled from 70 to 140 metres, according to wind resource engineers.
Going higher still to 170 metres is predicted to boost energy yield by 35% on average.
Ellis Clamps Supplied For Hong Kong High Speed Rail Extension
Manufacturer Ellis has supplied a total of 125,000 cable clamps for the Hong Kong MTR network high speed rail extension.
The clamps are being used to secure pilot, power, and fibre optic cables throughout all the tunnels in the Hong Kong section of the Express Rail Link (XRL).
XLR runs from the Shenzhen Hong Kong Boundary - where it connects to the China Mainland - to West Kowloon.
When fully operational, trains will be able to operate at a maximum speed of 200km per hour. Journey times would be cut by an average of 50%.
ETS Cable Components are the official suppliers, stockists and distributors of Ellis Patents cable cleats and clamps in the UK. See the extensive range here.
Images from 'Aurelien Guichard' (Guerkin) and 'Patrickmak' (Wind Turbine) - Creative Commons Licence.
Crossrail Completes 26 miles Of Tunnelling
Workers on Crossrail – described as Europe's biggest construction project – have finished 26 miles of tunnelling under the Capital.
Tunnelling began in 2012 and continued 24 hours a day, seven days a week. Eight tunnel boring machines were used to create the 6.2 m (20 ft) diameter tunnels.
Crossrail will eventually connect Reading and Heathrow in the west to Shenfield and Abbey Wood in the east to form a new 73-mile rail route. There will be with 40 stations; an expected 200 million passengers every year are expected to use Crossrail.
Services through central London are due to begin in December 2018.
HS2 Will ‘Go Ahead’
Construction on the new high speed rail line - HS2 - from London to Manchester will go ahead, the Secretary of State for Transport, Patrick McLoughlin, has vowed. He said construction would begin in two years.
Mr McLoughlin also promised HS3 – linking between Manchester, Liverpool, Leeds, Sheffield, Newcastle and Hull.
The Minister said the new rail infrastructure would mean the north could shape its own future by developing powers away from Whitehall.
Mr McLoughlin also said that the full ‘Y’ network HS2 will be built - from London to Birmingham and Birmingham to Manchester and Leeds.
Parliamentary scrutiny of the bill for phase one between London and Birmingham will begin shortly.
Sydney Light Railway Construction To Begin
Construction of Sydney’s South East Light Rail system is to start in October. Connecting up with Circular Quay and Central railway stations, the new rail network will stretch for 12 kilometres around the city centre.
The railway will also include Sydney Football Stadium, the Moore Park sporting and entertainment precinct, the University of New South Wales, Randwick Racecourse, and Prince of Wales Hospital at Randwick.
The project will be spread across 31 different construction zones. Major civil works will be completed in April 2018.