In this month's tracker, Construction Forecasting and Research reports firms are starting to feel a little more positive with order books and tender prices balances improving across the board
February's results show that the construction industry is slowly leaving its new year blues behind: order book and tender price balances improved across the residential, non-residential and civil engineering sectors.

However, it was not all good news: the balances for activity levels, employment and tender enquiries all continued January's downward trend.

The non-seasonally adjusted figures for the regions tell a different story, however: all regions experienced a rise in their activity balance in February, with only one exception: Wales. In five regions, balances actually turned positive. The biggest improvement was recorded in East Anglia, where the activity balance was up 46 percentage points, from -23 in January to +23 in February.

Almost half the survey respondents (46%) felt their activity levels were not constrained in February. The main constraint that was reported was bad weather (24%), followed by insufficient demand (17%).

Overall, the residential sector was the most upbeat, with rising balances in four of the five main indicators. The only exception was the activity balance, which remained unchanged.

Regarding changes in materials costs, most respondents reported a rise of between 2.6 and 5% between February 2002 and February 2001. Just over 60% of building firms and almost 80% of civil engineering firm reported rises in this bracket. However, no civil engineering firms reported a rise of more than 10%, whereas about 3% of building firms did.

The survey is conducted monthly among some 800 firms throughout the United Kingdom and the analysis is broken down by size of firm, sector of the industry and region. The results are weighted to reflect the size of respondents. In addition to the results published in this extract, all of the monthly topics are available by sector, region and size of firm. Quarterly questions also seek information on materials costs, labour costs and work in hand.

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Postscript

This is an extract from the monthly focus survey of construction activity undertaken by Construction Forecasting and Research on behalf of the European Commission as part of its suite of harmonised EU business surveys. The full survey results and further information on CFR's forecasts and services can be obtained from CFR by phoning 020-7808 7070 or logging on to www.constructionfutures.co.uk.

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