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Scotland’s small building firms had a strong start to 2019, in contrast to the UK construction small and medium sized enterprise (SME) sector, according to the Federation of Master Builders (FMB) Scotland.
The FMB State of Trade Survey for the first quarter of 2019, the only quarterly assessment of the UK-wide SME construction sector, showed SME workloads declined for the first time in six years.
In Scotland, however, there was a jump of 10 per cent compared with the previous quarter. Thirty per cent of weighted responses were positive, up from 20 per cent from the fourth quarter of 2018.
It is encouraging the Scottish construction industry is bucking the wider Brexit trend with workloads and enquires in rude health. The UK-wide picture is very different, with the construction SME sector overall contracting for the first time in six years.
Scotland’s good fortune could be due to fewer EU workers being based north of the border compared with other parts of the country, like in London where one in three construction workers are from the EU.
Relying less heavily on migrant workers has meant the Scottish construction industry hasn’t fallen foul of thousands of EU workers returning home during the long march to Brexit due to no longer feeling welcome in the UK or sure of their future here.
Scotland’s builders, however, must not be complacent. Looking ahead, the First Minister has indicated that if the UK does leave the EU later this year, she wants a second independence referendum before the next Scottish Parliament election in 2021. This additional political uncertainty, on top of the continued uncertainty stemming from Brexit, could impact on the construction sector in Scotland.
The fear is a looming second referendum could test consumer confidence this year and next. For construction SMEs, this is particularly concerning as their prospects are vulnerable to dips in consumer confidence as so much work comes from the private domestic sector.
Director of FMB Scotland.