INTRODUCTION
Welcome to the Q4 2024 edition of Construction Market Intelligence, RLB’s insightful, up-to-date guide to construction activity around the UK incorporating our quarterly tender price forecast.
The RLB Tender Price Index forecast uplift for 2024, as at Q4 2024, is:
3.03%
Previous quarter's forecast for 2024: 2.97%
Geopolitical events at home and abroad impacting outlook for construction sector
This edition of Construction Market Intelligence takes a high-level overview of the construction industry, touching upon global and regional influences and exploring the national and regional impacts of the recent UK Budget.
The global perspective must take account of the fact that the outcomes of the conflicts in Gaza and Ukraine remain unknowable. Change is certainly likely given the impending passing of power in the US and the incoming administration’s positions on both matters. A figuratively more distanced US could change the parameters of any settlement in either case, and that will have knock-on effects, particularly on surrounding countries and economies.
From a European standpoint, a resolution of the Ukraine conflict could radically change the construction industry in Europe. Construction stands to be particularly affected by any settlement, and the UK is not alone in struggling to cope with skilled and unskilled labour shortages. A new demand shock could yet lead to increased turbulence in the home labour market.
Looking more inwardly, increases in tax-take are set to underpin increased government spending on public services, in the hope that GDP growth will be the saviour. Of note, however, is the hike of National Insurance contributions, which will impose considerable additional costs across the board for employers.
The Office for Budget Responsibility, in its independent view, has revised its growth forecast for this year’s GDP to over 1%, and on to around 2% for each of 2025 and 2026. While these levels seem favourable in light of recent experience, they remain historically soft, although they could be said to be damping any further inflationary outbreak.
