Confidence is returning to the market
When you see the Chancellor on the news visiting a construction site adorned in a hi-vis jacket and hard hat you realise that what often follows is the release of positive economic data. But why does the Chancellor choose to deliver his message in this way?
Coming out of the recession it was clear that the construction industry in the Sheffield City Region was badly affected. Firms were unable to finance ongoing projects, office blocks were being completed but remaining empty, there was an exodus of talent and property prices were falling. Confidence to commit to large capital projects and development works was low. However it now appears that this trend is reversing.
Looking back over the past 5 years of Rapid Growth Surveys it can be seen that the roots of the Sheffield City Region lie strongly within the manufacturing and engineering sectors. Each year these two sectors have together consistently made up 20% – 30% of the companies listed in the survey.
Notably, this year the construction sector made up the greatest proportion of the companies in the survey at 27% compared with just 7% 5 years ago, with an influx of new entrants achieving substantial growth. Commercial and residential property development companies such as Strawson Developments and Strata Homes have demonstrated significant growth in turnover owing to stronger plot sales and the conversion of development works.
The increased prominence of these companies in this year’s survey is an encouraging sign that businesses and consumers are willing, able and have the confidence to commit to significant capital outlays.
On a more regional level it is also encouraging to see larger scale developments being undertaken such as the Olympic Legacy Park on the former Don Valley site, the iPort at Doncaster and the proposed retail quarter in Sheffield City Centre, all multi-million pound projects set to bring added prosperity and act as catalysts to continuing investment.
Finally, the importance of opportunities and resources to support businesses in the region is evident. The regional growth programme gave 120 private companies the means and confidence to deliver capital development projects. Hopefully we will see local and national support continue to deliver this for businesses.
As you may have picked up on, confidence for me is the “buzz” word and it is exactly the reason the Chancellor delivered his message in this way… confidence is returning to the market and we should be building for the future.
BHP’s Rapid Growth Survey was published in The Star 9 September 2015 – take a look here: http://edition.pagesuite-professional.co.uk//launch.aspx?eid=6f697790-d8f5-4e5b-86f4-74a3e22362a6