To keep up with increasing workloads in construction, surveyors are braced for a 10% rise in material prices over the next 12 months.
RICS Construction and Infrastructure Survey for Q2 2021 found that a record 82% of respondents have already reported a shortage of materials, up from 57% in the first 3 months of the year. Ahead of the 7% growth anticipated for tender prices, the cost of materials is expected to increase by nearly 10% over the next twelve months.
The quarterly survey found that sales of aggregates in the first half of 2021 were at their highest since mid-2008, driven by demand on major infrastructure projects and highway schemes. Surveyors predict construction workloads will continue to grow and with a shortage of construction staff both blue and white-collar means a bigger push should be put on upskilling construction workers and bringing new talent into the industry.
Simon Rubinsohn, RICS Chief Economist said: “Infrastructure and private housebuilding are viewed as likely to remain the most buoyant areas of the industry. Yet it is abundantly clear that a couple of issues present big challenges. Most notably at this point, the availability of building materials stands out as a key problem for respondents to the RICS survey.
“But almost as significantly, labour and skills are increasingly being cited as obstacles for businesses looking to build out existing commitments or embark on new projects. For the time being, the issue appears most visible regarding skilled trades but quantity surveyors are also being highlighted as an area of growing shortage.
“Unsurprisingly against this backdrop, some concern is being expressed about rising construction costs.”
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