Turnover and employment continued to increase in the construction sector – CIF Construction Outlook Survey, Quarter 2 2024

Turnover and employment continued to increase in the construction sector during Quarter 2 of this year and this trend is expected to continue, according to the Construction Outlook Survey released today by the Construction Industry Federation.

One third of companies surveyed reported a year-on-year increase in turnover during Quarter 2 2024. 30% of companies reported a year-on-year increase in the total number of people they employed in the same period, with 26% expecting to employ more staff in the coming months.

28% of companies reported an increase in revenue from new orders. This was reported across general contracting and home building, with a decrease in new order revenue across civil engineering and specialist contracting. All sectors expect an uplift in Quarter 3, except for civil engineering.

The cost of labour and raw materials continues to put upward pressure on pricing across all sub sectors, with 67% of survey respondents experiencing a year-on-year increase in the cost of labour and 64% reporting a year-on-year increase in the cost of raw materials. 54% of companies expect the cost of labour to continue to increase in Quarter 3.

Hubert Fitzpatrick, Director General of the Construction Industry Federation said:  “Unprecedented demographic growth and an ageing population will mean that Ireland’s demand for investment in critical infrastructure will reach beyond the existing capital ceilings, especially in water services, housing and transport.  The Construction Industry Federation is calling for an expansionary Budget in 2025 to support Government’s competing policy choices in the year ahead, in the context of Europe’s twin green and digital transitions and growing geopolitical and economic instability.

“Hyperinflation in many building and construction materials in recent years, as well as fuel, has put a strain on the cost of delivering some of the infrastructure projects in the National Development Plan, as capital budgets are pre-determined. The Construction Outlook Survey results have been tracking this for some time.

“Though easing, the duration of inflation and rising prices remains somewhat uncertain. Slow economic growth and diverging levels of inflation across European Member States is now a reality.

“Our cities, provincial towns and regional communities require Irish construction companies to deliver billions of investment in critical infrastructure under the National Development Plan to drive economic growth. At a minimum, Irish society needs the construction industry to deliver at least 50,000 housing units annually from now until 2050. For economic growth to be sustained, investment momentum must be supported.”

The survey also found that the key challenges facing the construction sector are access to skilled labour (73%), securing a healthy profit margin (61%), increased cost of materials (56%) and continuity of work (50%).

Hubert Fitzpatrick said: “The industry has always demonstrated its capacity to ramp up and secure the required resources for delivery and can reallocate resources from sector to sector as required. Sightline on a credible pipeline of shovel-ready infrastructural construction projects is crucial to provide confidence for the sector to ramp up investment and secure the resources needed for project delivery. We urge Government to increase investment in the country’s critical infrastructure needs and to continue to support positive initiatives to educate young people about the rewarding career opportunities in construction.”

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Editors Notes:

The Construction Outlook Survey is carried out quarterly by the Construction Industry Federation with its members. The survey of 231 construction companies carried out between 11 – 22 July found that:

• 33% acknowledge an increase in turnover YOY in Q2 with 32% expecting turnover to continue to increase in Q3.
• 30% report an increase in the total number of people employed with 26% expecting the trend to continue in Q3.
• 67% experienced a YOY increase in the cost of labour with 54% expecting the trend to continue in the next 3 months.
• 64% report a YOY increase in the cost of raw materials with 52% anticipating the trend to continue in the next 3 months.
• Increasing costs continue to impact the pricing of projects with 50% acknowledging a YOY increase and 43% expecting continued increases in Q3
• Access to skilled labour (73%), securing a healthy profit margin on projects (61%) and the increased cost of raw materials (56%) remain the three most significant challenges facing the construction industry.
• In terms of exports, commercial office development, housing, healthcare facilities and data centres are the most exported construction services amongst exporting companies.

Read the CIF Construction Outlook Survey Quarter 2

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For media queries contact:

Meabh Smith
CIF Communications Director
0871338978

Jennifer Nisbet Daly
CIF Communications Executive
0874075025