4th Quarter 2000 - Workload Trends Workload in the Fourth Quarter of 2000 The overall result for the change in FMB survey respondents' total workload between the third and fourth quarters of 2000 is very similar to that between the second and third quarters, recorded by the last survey. When replies are weighted by size of firm, 46% report an increase in workload and 18% a reduction. The first of these figures is one percentage point higher than last time, whilst the latter of them is the same as before. For all respondents, therefore, the weighted percentage balance is increased marginally to +28. The separate balances for builders and specialist contractors are also very close to those recorded by the third quarter survey, although among specialists the proportions reporting a change in workload, both up and down, are lower than last time, whilst the 'same' proportion is increased from 29% to 43%.
Table 1 - Change in Total Construction in the Last Quarter   1999 2000 Fourth Quarter 2000   Weighted % balance Weighted % balance Weighted percentage   Q4 Q1 Q2 Q3 Higher Same Lower Balance North +40 32 52 15 +17 Yorks & Humber +60 52 36 12 +40 East Midlands +29 67 13 2 +65 East Anglia +37 26 27 47 -20 London +36 48 45 7 +41 South East +40 42 38 20 +22 South West +30 50 29 21 +29 West Midlands -16 32 62 6 +26 North West +11 36 35 29 +7 Wales -56 84 3 13 +71 All builders +10 +15 +14 +28 46 35 19 +27 All specialists -7 +5 -9 +23 41 43 16 +25 National +6 +12 +11 +27 46 36 18 +28
When seasonal factors are taken into account, however, it may be recognised that the fourth quarter result is relatively stronger than that for the third quarter by more than is suggested by the single point rise in the percentage balance. It is also significantly stronger than that for the fourth quarter of 1999, when only 32% of all respondents reported workload higher than in the third quarter, and 26% said there had been a fall. Looking at the results by standard region, apparently the best is that for Wales, but this should be treated with caution as the number of replies from Wales is relatively low. Amongst other regions the most marked improvements, compared with the third quarter, are in the balances for firms operating principally in the East and West Midlands. In only one region, East Anglia, is the result this time seriously worse than last time, with almost half the respondents operating mainly in that region indicating a fall in workload. The balance for the neighbouring Bedfordshire/Essex/Hertfordshire segment of the South East region is only just positive.
Table 2 - Changes in Construction Workload by Type of Work   1999 2000 Fourth Quarter 2000   Weighted % balance Weighted % balance Weighted percentages   Q4 Q1 Q2 Q3 Higher Same Lower Balance Housing:                 Private new +4 +8 +5 +8 23 60 17 +6 Private RM&I +10 +13 +13 +22 27 62 11 +16 Social new -7 +1 -23 -13 6 71 23 -17 Social RM&I -4 -3 -6 +23 29 59 12 +17 Non-Residential:                 Public new build -11 0 -23 +5 31 48 21 +10 Public R&M -11 +3 -22 +11 27 58 15 +12 Industrial -4 -8 +7 +11 21 55 24 -3 Commercial +4 +8 -2 +8 32 52 16 +16 Private R&M +2 +5 -3 +19 26 62 12 +14
The results for different types of work are also mostly similar to those of the third quarter survey, in terms both of the weighted percentage balances of replies, and how they are obtained in terms of percentages of 'higher' and 'lower' replies. The balance for commercial work, +16, is the second best for that sector since the methodology of the survey was changed two years ago, and is matched by another strong result for private housing repair, maintenance and improvement (RM&I); but that for industrial building work has weakened again. However, the main interest this time may be in the continued improvement of the results for three of the four types of work for public sector clients. The balances for RM&I of existing social housing, and for both new build and refurbishment, and repair and maintenance (R&M), of non-residential public buildings, all of which turned positive in the third quarter, are clearly positive again this time. Only that for social housing new build is lagging. Overall, for most regions, and for most types of work the out-turn balances are better than those of firms' expectations of the direction of change expressed in the third quarter survey, that are recalled in Tables 3 and 4. At that time only 27% of respondents anticipated a rise in workload in the final quarter of the year, whilst 24% were looking forward to a downturn. The principal exceptions to this general rule are that the two regions displaying the weakest out-turn balances, East Anglia and the North West, were two of the three in which expectations were highest last time. By comparison, firms operating principally in London, the rest of the South East, and the South West, and those in Yorkshire and Humberside, had relatively modest expectations that have been exceeded by their actual experience in the final three months of the year. Expected Workload in the First Quarter of 2001 Expectations are normally weaker not only in the third quarter looking towards the fourth but also, and indeed in a more pronounced fashion, at the end of the old year looking forward to the first three months of the new one. A year ago, the report on the fourth quarter 1999 survey suggested that the overall result, with nearly a quarter anticipating a rise in work but a third expecting a fall, indicated "a relatively solid market, with no more of a downturn in prospect than might normally be anticipated at this time of year". By comparison, the trend now expected in the first quarter of 2001 is a little stronger than that anticipated a year ago, with 31% looking for total workload to rise, compared with 27% expecting a fall. For builders the 'higher' percentage is higher and the 'lower' figure is lower than in the fourth quarter 1999 survey, but the overall result is pulled down by the weaker expectations of specialist contractor respondents.
Table 3 - Expected Changes in Workload, Next Quarter, by Type of Work   1999 2000 Fourth Quarter 2000   Weighted % balance Weighted % balance Weighted percentages   Q4 Q1 Q2 Q3 Higher Same Lower Balance Housing:                 Private new +1 +28 +17 +8 11 66 23 -12 Private RM&I -2 +24 +18 +9 17 64 19 -2 Social new -20 +1 -26 -6 1 76 23 -22 Social RM&I -4 +23 +9 +5 24 57 19 +5 Non-Residential:                 Public new build -12 +13 +2 +1 19 62 19 0 Public R&M -6 +13 +1 -3 14 67 19 -5 Industrial -7 +3 -4 -6 12 59 29 -17 Commercial -5 +19 +2 -1 19 59 22 -3 Private R&M -7 +23 +2 -5 15 62 23 -8
Looking at the results for different types of work, displayed in Table 3, there is a positive balance of replies for only one of the nine sectors listed, namely RM&I of existing social housing, for which the balance was negative a year earlier. There are also somewhat more optimistic expectations than at the end of 1999 for new build and refurbishment of non-residential public buildings, whereas expected trends in private sector work, and also social housing new build and public non-residential R&M, are no better or slightly worse than a year ago.
Table 4 - Expected Changes in Workload, Next Quarter, by Region   1999 2000 Fourth Quarter 2000   Weighted % balance Weighted % balance Weighted percentage   Q4 Q1 Q2 Q3 Higher Same Lower Balance North +27 10 70 20 -10 Yorks & Humber +6 32 51 17 +15 East Midlands +33 43 24 33 +10 East Anglia +27 13 56 31 -18 London -8 33 54 13 +20 South East +2 28 49 23 +5 South West -12 37 30 33 +4 West Midlands +3 37 27 36 +1 North West +28 26 35 39 -13 Wales -28 47 34 19 +28 All builders -7 +34 +25 0 34 41 25 +6 All specialists -16 +30 0 +15 19 46 35 -16 National -9 +34 +19 +3 31 42 27 +4 Judging by the results of this and the last survey for the change in workload from the preceding quarter, it seems that the Government's promises of more money for public building works are at last having a positive effect on the workload of FMB members. As a result, firms have developed a more positive attitude to prospects for most types of work for public sector clients, and it is this that accounts for the small positive balance of 'higher' and 'lower' replies for the expected trend in total work in the first three months of 2001. Table 4 above shows that the proportion of respondents anticipating a rise in work is around one third for most of the standard regions. It is much lower than that only for the North and East Anglia - and also for the Kent/Surrey/Sussex segment of the South East - and for these areas, and for the North West, the balance of 'higher' and 'lower' expectations for workload is negative. On balance, the most optimistic group is that of firms operating principally in the London area, of which only 13% anticipate a drop in total workload in the first quarter of the new year.
First posted: 9 January 2001. Last modified: 11 January 2001.