Construction firms in Northern Ireland will struggle to stay open due to 'inflationary pressures'

Contraction firms across Northern Ireland are struggling to operate as rising inflation pressures over the last 18 months are having an increasingly unsustainable effect on the viability of a growing number of businesses.

The latest CEF Construction Survey reflects a sector where the inflationary pressures of the last 18 months are having an increasingly unsustainable effect on the viability of a growing number of businesses.

The survey, which collected data from NI-headquartered firms which have a collective annual turnover in excess of £1bn, covers the first six months of 2022 and reflects on many of the key challenges that contractors, civil engineers and housebuilders are facing currently.

Over a third of firms surveyed stated their main priority in the year ahead was simply to survive and remain open.

Only 11% said their main priority was growth and expanding turnover while 17% stated their main aim was survival and staying in business by any means.

68% felt that rising material costs/inflation could have a serious or critical impact on their ability to deliver on contracts/projects.

94% expect construction materials costs to continue to rise over the next 3 months.

Mark Spence, Managing Director of the Construction Employers Federation, said: “These results paint a stark picture of a sector that, whilst resilient in the face of many of the unprecedented headwinds of the last two years, is finding the never-ending inflationary pressures increasingly impossible to bear.

"With absolutely no sign of these pressures easing over the rest of 2022 and into 2023 we are seeing a significant draining of confidence within our membership as to their medium-term prospects – with an alarming number now talking openly about business survival as being their main focus."