“Cossy livs” – the impact of rising costs on the construction industry

5th October 2023 11:21

Associate Director, Rachel Hancock shares some insights from our in-house panel, Opinion Exchange (OpEx) on current challenges in the construction industry and an outlook for the sector.

Cost of living is possibly one of the most widely mentioned terms in the news right now, which has even led to a new slang term “cossy livs” (a personal bugbear of mine!) doing the rounds on social media. Given that my day job is predominantly researching businesses, this prompted me to wonder the extent to which construction businesses are feeling the squeeze and if costs are indeed their main concern.

At DJS Research, we have an in-house panel, OpEx, which has been growing over the past few years. This has meant we can identify sub-segments, such as construction, which we can use to quickly obtain insights on a range of topics.

When asked about current challenges facing the industry as a whole, rising costs are indeed the top concern for those working in construction. However, almost equally concerning is a labour and skills shortage – this is a challenge that spans many industries, as evidenced by our recent work for the Royal Academy of Engineering which highlighted how diversity and inclusion may help close the growing skills gap and help to solve labour shortages.

More specifically, we wanted to understand which single challenge is of most concern to businesses over the next year, and this is where rising costs come to the fore.

However, recent data suggests that inflation growth is slowing and there may be light at the end of the tunnel. With this in mind, we sought to understand the outlook for the construction industry over the next year.

On the whole, the outlook for the sector is still mostly positive (61%), with this cautious optimism appearing to be driven by a strong order book, particularly in the commercial and industrial sectors. This sentiment is echoed by other data sources such as the RICS construction outlook, which in Q2 2023 reported a ‘modestly positive’ outlook.

Whilst none of the construction panellists we surveyed felt ‘very negative’ about the outlook, some, however are less optimistic, with the unpredictable nature of the economy, unpaid debts and project delays all contributing factors. In particular, residential construction appears most challenged due to higher interest rates and associated mortgage payments, which limit the demand and affordability of new homes.

This is just one example of how we can use our construction panel to obtain quick answers on a range of topics.

To give you an idea of the wide variety of people on our panel, we surveyed construction professionals including general builders, plumbers, joiners, bricklayers, electricians, roofers… to name just a few! Amongst these, were a mix of site and office-based staff across the UK, who work for a range of organisation sizes.

If you’d like to discuss how we can help your business, or for more information on our research offering in the construction sector, please get in touch with Rachel Hancock at rhancock@djsresearch.com or James Hinde jhinde@djsresearch.com or visit our webpage here.

Or, if you work in construction and are interested in joining our construction panel and taking part in future research, please click here