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Construction forecasters bet on delayed soft Brexit

January 18th, 2019 Comments off

Forecasters predict construction will just avoid an output decline this year if a soft Brexit is finally delivered.

But economists for Experian warn that their forecast of sluggish growth would have to be ripped up if the UK crashes out of the European Union with no deal.

The latest forecast for the next three years predicts construction will see a weak 0.4% rise in workloads this year followed by a return to stable but below trend growth of between 2.5%-3% in 2020 and 2021.

Forecasters now presume a “soft Brexit” will be the eventual outcome, with the UK gaining similar access to the EU single market as it does currently.

“We fully anticipate that such a deal could take longer to conclude than the initial transition period, and we do not expect a Brexit deal related bounce back in output growth to materialise until 2021,” says the report

It also assumes the planned  Wylfa nuclear power station is not cancelled and the road building programme does not slip, as some in the industry fear.

Of the three key construction sectors housing and infrastructure are expected to experience good growth while there is weakness in the non-residential building sectors, like offices, retail and education.

It will probably not be until towards the mid-2020s that this profile unwinds.

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