4th Quarter 1999 - Workload Trends Workload in the Fourth Quarter of 1999 The overall result for the change in survey respondents' workload between the third and fourth quarters of 1999 is relatively healthy, with nearly a third reporting an increase compared with just over a quarter saying that their workload has fallen. The balance of weighted percentages of replies indicating total workload higher or lower than in the third quarter is +6, eight points weaker than in the previous survey, but still showing a small increase in total activity in a quarter in which seasonal factors tend to work against such a result. Table 1 shows that it is still the case, as in each of the first three surveys last year, that the result for the builders taking part in the survey is better than that for the specialist contractors. However, whilst the builders' result is weaker in the fourth quarter than the third, that for the specialist contractors, who account for a little under a quarter of the total response, shows a slight improvement this time.
Table 1 - Change in Total Construction in the Last Quarter   1998 1999 1999 Q4   % balance* Weighted % balance Weighted percentages   Q4 Q1 Q2 Q3 Higher Same Lower Balance Northern +10 -28 -16 +13 28 35 37 -9 North West -13 +5 -15 +9 15 53 32 -17 Yorkshire & Trent -12 +9 +4 +27 34 50 16 +18 Midlands -8 -20 -26 -4 39 36 25 +14 Eastern -9 -18 +31 +36 25 48 27 -2 London +11 +15 +28 +21 46 20 34 +12 Southern -20 +28 -4 +7 41 37 22 +19 South West -10 +4 -8 +18 32 59 9 +23 South Wales -15 -21 -27 -42 22 51 27 -5 All builders   +3 +9 +20 34 42 24 +10 All specialists   -13 -39 -13 25 43 32 -7 National -9 -1 -1 +14 32 42 26 +6 * Not weighted
The South West has the best result of any of the regions, with nearly a third saying their workload is increased, no more than across the whole country, but the percentage reporting a fall in work in this region is down in single figures. London Region, Southern Counties, and Yorkshire & Trent again show positive balances of percentages saying workload is higher or lower, though in the first and third of these regions there is a fall compared with the third quarter. The result from London is remarkable for the relatively low proportion, only 20%, indicating no change in workload from the third to the fourth quarter. By comparison, the South West has 59% reporting no change, and the North West 53%. In the latter of these two regions, however, there is a sharp fall in the 'higher' percentage, causing the small positive balance recorded last time to be replaced by one of -17, the poorest of any region. Northern Counties also see a modest positive balance in the third quarter change to a negative one in the final three months of the year. However, relatively the largest change up or down is in the balance for the Eastern Counties, down from +36 to -2. In this region the proportion reporting workload higher has slipped from nearly a half to a quarter between the third and fourth quarter surveys. As may be seen by comparing Tables 1 and 4, the outturn for the change in workload is better than the change anticipated at the end of the third quarter, overall and in all regions except the North West. The proportion reporting workload up is a little higher than anticipated, whilst that saying activity was lower is smaller. Looking at the results by type of work, the overriding impression is of a contrast between the trends in work for private and for public sector clients. As in the third quarter, there are positive balances in four of the five divisions of private sector work, the exception being new build and refurbishment of industrial buildings, in respect of which a third quarter balance of +10 has given way to one of -4 this time. The balance of commercial work is clearly weaker than last time, but that for private housing repair, maintenance and improvement (RM&I) is broadly maintained, whilst private housing new build, and repair and maintenance (R&M) of non-residential buildings for private sector clients, are both up from a small minus to a small plus. On the public sector side, by contrast, the third quarter's encouraging improvement in the balance for social housing RM&I, and in that for non-residential building work for public sector clients, is reversed this time, and there are still negative balances for social housing new build and for R&M of public non-residential buildings.
Table 2 - Changes in Construction Workload by Type of Work   1998 1999 1999 Q4   % balance* Weighted % balance Weighted percentages   Q4 Q1 Q2 Q3 Higher Same Lower Balance Housing:                 Private new -11 -13 -2 -5 25 54 21 +4 Private RM&I +2 0 +9 +12 26 58 16 +10 Social new -14 -7 -36 -7 14 65 21 -7 Social RM&I -12 -13 -7 +6 17 62 21 -4 Non-Residential:                 Public new build -5 -21 -14 +3 13 63 24 -11 Public R&M -10 -33 -9 -5 18 63 24 -11 Industrial -20 -12 -16 +10 17 62 21 -4 Commercial -16 -3 0 +18 25 54 21 +4 Private R&M -10 -13 0 -2 21 60 19 +2 * Not weighted
Comparison with the expectations expressed at the end of the third quarter, that are recapitulated in Table 3, shows that the main difference between expectation and outturn is in respect of social housing new build, with far fewer reporting a further downturn than had expected to do so. Of relatively greater significance for the overall result, however, are the suggestions of a slight increase in work in connection with private housing new build and - most important of all - the resilience of the private housing RM&I sector. Private housing RM&I again shows up as the crucial sector for FMB members, with 66% of survey respondents engaged in this type of work. This compares with 61% for commercial work, and 52% for R&M of non-residential buildings for private sector clients. At the other end of the scale, the lowest proportions are 30% for work on new social housing, and 42% for new build and refurbishment of non-residential buildings for public sector clients. In respect of all types of work, however, the percentage balances are relatively small this time, and in every case they are struck between 'higher' and 'lower' percentages that add up to less than 50%. For five of the nine types of work the 'same' proportion is 60%-65%, which reinforces the impression that there was relatively little change between the third and fourth quarters. It is shown later that this impression is backed by the results for the change in employment in the fourth quarter. Expected Workload in the First Quarter of 2000 Looking forward to the January-March quarter of 2000, FMB survey respondents expect activity to turn down in all sectors of their market except private housing new build, where the proportion expecting a rise in work, 22%, is just a point ahead of that anticipating a fall. However, for this question also balances are generally small, and for all types of work the proportion expecting no change is more than half. The overall impression, therefore, is of a relatively solid market, with no more of a downturn in workload in prospect than might normally be anticipated at this time of year. It is shown later that expectations of employment levels confirm this impression.
Table 3 - Expected Changes in Workload, Next Quarter, by Type of Work   1998 1999 1999 Q4   % balance* Weighted % balance Weighted percentages   Q4 Q1 Q2 Q3 Higher Same Lower Balance Housing:                 Private new -22 +15 +1 -14 22 57 21 +1 Private RM&I -8 +9 +9 -3 17 64 19 -2 Social new -27 -21 -15 -36 4 72 24 -20 Social RM&I -21 -8 -16 -6 14 68 18 -4 Non-Residential:                 Public new build -23 -12 -10 -12 18 52 30 -12 Public R&M -17 -6 -10 -10 15 64 21 -6 Industrial -23 -11 -3 0 20 53 27 -7 Commercial -19 -3 +5 +5 20 55 25 -5 Private R&M -22 -2 -6 +8 13 67 20 -7 * Not weighted
For most types of work, the balances of expectations for the coming quarter are not very greatly different from those recorded at the end of the third quarter of 1999. The main improvement is in the balance for private housing new build, that was negative last time, whereas the most slippage is in expectations of work on non-residential buildings for private sector clients, including R&M work. There are only two regions where the balance of percentages expecting a rise or a fall in workload in the first quarter is positive; but that is no different a result from last time. Then it was Southern Counties and South Wales where expectations were ahead of the national trend. This time it is London Region and Yorkshire & Trent that show pluses. The very optimistic result from the latter of these is based on relatively high expectations for private housing new build and all non-residential building.
Table 4 - Expected Changes in Workload, Next Quarter, by Region   1999 1999 Q4 Weighted % balance Weighted percentages Q1 Q2 Q3 Higher Same Lower Balance Northern +12 -23 -20 14 28 58 -44 North West -20 +7 -10 14 55 31 -17 Yorkshire & Trent +37 +16 -4 41 47 12 +29 Midlands -13 -11 -15 27 39 34 -7 Eastern +16 +8 -16 35 22 43 -8 London +30 +11 -1 27 55 18 +9 Southern +30 +17 +8 27 32 41 -14 South West +23 +16 -3 11 61 28 -17 South Wales -6 +11 +22 5 39 56 -51 All builders +15 +10 -3 26 41 33 -7 All specialists +13 0 -15 17 50 33 -16 National +14 +7 -5 24 43 33 -9 * Not weighted
First posted: 25 January 2000. Last modified: 25 January 2000.