Consultant expects current recession to be short-lived
Turner & Townsend is telling its clients to start proactively planning for a resurgence in construction activity, while also revising up its inflation forecasts for the UK industry.
The business has increased its 2024 tender price inflation forecast for real estate to 3.2%, up from the 2.7% it previously predicted in December.
For infrastructure, the forecast remains at 4.5%, although this is lower than 2023鈥檚 5.5% and 10% in 2022.
T&T said it expected the current recession to be short-lived and shallow, with confidence and investment increasing as the Bank of England cuts interest rates in response to overall falling inflation.
It said clients needed to secure their supply chains for upcoming jobs to make the most of positive conditions.
And it added they needed to carry out 鈥渞obust procurement and pre-qualification checks to minimise the risk of contractor insolvencies impacting programmes鈥�.
T&T鈥檚 UK managing director for cost management, Martin Sudweeks, said: 鈥淭here is plenty of room for optimism in 2024. Even as we head into a period of political and economic unknowns, built asset investment decisions are now being made, not delayed.
鈥淭his is not to say we鈥檝e got an easy ride ahead of us. We still face structural issues, particularly the pressing skills shortage.鈥�
Earlier today, the ONS said construction grew 1.1% in January, helping overall GDP rise 0.2% in the first month of the year.
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