Turnover and employment increases continue in construction sector: Quarter Four Construction Outlook Survey from the Construction Industry Federation

Turnover and employment in the construction sector continue to increase, according to the latest Construction Outlook Survey, released today by the Construction Industry Federation.

The survey found a year-on-year increase in revenue from new orders across general contracting, home building and specialist contracting, but a decrease was evident in the civil engineering sector. 35% of companies expect a revenue uplift from new orders in Q4 2024, except for civil engineering.

The cost of labour and raw materials continues to put upward pressure on pricing across all sub sectors, with 66% of survey respondents experiencing a year-on-year increase in the cost of labour and 62% report a year-on-year increase in the cost of raw materials. The increase in project pricing appears likely to continue into Q4, albeit at a reduced rate.

Employment levels remain positive year-on-year across all sectors and all company sizes except those with a turnover less than €300k. Employment levels are expected to grow across all companies in Q4, most notably those with turnover of over €9m. 43% of companies across all sectors expect the cost of labour to continue to increase in Q4.

The year-on-year increase in the cost of raw materials was reported across all sectors. Most companies expect the cost of raw materials to continue to increase in Q4.

The survey examined the type of construction projects that companies are delivering. There continues to be a notable overlap in companies working across residential, non-residential and civil engineering.

In terms of exports, 22% of larger companies, over €9m turnover, exported construction services in the last 12 months. Data centres, pharma plants and energy generation were the most common projects delivered internationally.

Hubert Fitzpatrick, Director General of the Construction Industry Federation said: “The results from CIF’s quarterly Construction Outlook Survey support the fact that the construction sector is investing heavily in its productivity and sustainability. The industry is striving to remain competitive in a very constrained operating environment.

“An increasing level of Irish construction contractors are exporting their services and working with their existing FDI clients in other jurisdictions. This illustrates that capacity exists within the sector to deliver upon the much-needed infrastructure, like water and energy, supporting services, job creation, FDI and housing.

“Any uncertainty around government or state agency budgets could result in contractors constructing public infrastructure projects joining this export movement at time when we need them delivering Ireland’s much-needed infrastructure.

“Continuity and certainty around public works and significant further reform of public procurement and contracts are needed to retain our contracting members for domestic infrastructural projects.”

The survey of 242 construction companies found that:

• 33% report increased turnover YOY for Q3 2024 with 35% expecting turnover to increase in Q4.
• 22% report an increase in the total number of people they employ in Q3, with 25% expecting the trend to continue over the next three months.
• 66% experienced a YOY increase in the cost of labour with 43% expecting the trend to continue in Q4.
• The cost of raw materials continues to be an issue with 64% reporting a YOY increase, while 52% anticipate raw material costs to continue to increase in Q4.
• Increasing costs continue to impact on the pricing of projects with 52% acknowledging a YOY increase and 34% expecting continued increases in Q4.
• Access to skilled labour (75%), securing a healthy profit margin on projects (55%) and the increased cost of raw materials (52%) remain the three most significant challenges facing the construction industry.
• Almost one in five companies acknowledge sustainability reporting as a key challenge.
• In terms of exports, only 5% of companies surveyed on this occasion exported construction services in the last 12 months but 11% of civil engineering/infrastructure and 10% of specialist contracting companies report doing so.
• Notably, 22% of larger companies (€9m+) exported construction services in the last 12 months. Data centres, pharma plants and energy generation were the most common projects delivered internationally in the last 12 months.

Read CIF’s Q4 Construction Outlook Survey.

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For media queries:

Meabh Smith
CIF Communications Director
0871338978