19 Aug 2022

Longford's construction ills have 'not hit ceiling' yet, says industry expert

Longford building industry

Pay rises to match the cost of living alongside a further upsurge in selected materials mean the tip of Longford’s construction industry woes have yet to be fully felt

Pay rises to match the cost of living alongside a further upsurge in selected materials mean the tip of Longford’s construction industry woes have yet to be fully felt.

According to local independent chartered quantity surveyor Angela Crossan, the issues engulfing the county and broader midlands region’s building sector are likely to worsen over the coming months.

A leading professional with over 20 years of experience, Angela alluded to the still lingering after effects of the pandemic and Russia’s invasion of Ukraine as two key contributory factors behind the industry’s current malaise.

“Availability and cost of materials and labour are huge issues facing the sector at the moment,” she said.

“The increase in demand within the sector following the prolonged closures due to Covid-19, significant increases in material prices due to shortages with Brexit supply-chain effects being seen and resourcing/labour shortages within the sector – are all factors affecting the industry in 2021 and into 2022.”

Russian President Vladimir Putin’s offensive in Ukraine, she added, has “added heat” to a situation which was exemplified in a Society of Chartered Quantity Surveyors Ireland Tender Price Index in July which indicated year-on-year national tender price inflation was running at 14%.

She said such is the volatility of the tendering marketplace, private and commercially orientated clients are routinely having to consider pitching anticipated contracts with inflationary hikes in mind in order to keep revenue channels ticking over.

“Our (quantity surveying) role in assisting clients to identify budgets and bring projects to completion within that budget has been made difficult in the present climate - we have to be realistic and make allowance for future inflation,” she said, adding it was a similar dilemma for contractors.

“We advise contractors to price in for inflation as it’s better to have a viable contract sum rather than working at a loss and going out of business.”

As for whether further financial strain awaited an industry she has spent two decades immersed in, Angela was unequivocal in her response.

“Have we hit the ceiling ? Unfortunately, it is unlikely we have hit a ceiling. For example, cement is due to increase again in September.

“Also wage inflation is probably the next problem to add into the mix but that could be six months down the line.”

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