Trade and construction sectors prove to be essential, providing a backbone to the economy.
The Prime Minister has announced a Tier 4 ‘Stay At Home’ alert level in response to the rapid spread of the new Coronavirus variant. This will see various parts of the country set to remain in their homes; if they are unable to work from home, they will be allowed to travel to work. This is particularly applicable to the construction and manufacturing sectors.
The tightening of restrictions has caused serious concerns for the UK’s economy, with many sectors and businesses fearing that they will have to close their doors for good. In light of these concerns, the industries that are allowed to remain open will prove to be the backbone of the economy during these concerning times. The construction and manufacturing sectors have seen particular growth following the lift in the spring lockdown according to PMI data, and this upward trajectory is hoping to continue.
Ben Dyer, CEO of Powered Now, discusses how British construction and manufacturing will fare in the winter and highlights the impact Tier 4 will have on SMEs in the trades.
“The economic recovery we have seen over the past months is indeed welcome, but of course with much of Britain being placed into Tier 4, this month and the subsequent winter season are of course going to present yet more challenges. That’s why it would prudent to look towards sectors that remain open, such as construction and the trades, to provide the kind of stability we need at the moment.
The new restrictions have had a negligible impact on the construction sector so far, and overall activity around construction has to be welcomed. Given the bonanza that housebuilders are currently experiencing from the stamp duty reduction, it’s no surprise that they are the best performing sector of the construction industry. Whether this boom for the housing industry will be followed by a bust is unknown. At the moment, most firms are just grateful for the good business they are getting right now given how much other sectors are suffering.
It is disappointing that the supply of building materials remains a constraint and it could be argued that suppliers over-reacted to the first lockdown, creating this situation. The reduction in the rate of PMI growth could be the first signs of a drop in demand from lockdown related macroeconomic damage. Let’s hope that isn’t the case. However, it looks like the new restrictions will not impact the specific sub-sector of home improvement either, although the jury is still out. It may be that homeowners become more anxious over time, particularly if the virus continues spreading rapidly. The biggest concern overall is about the supply of materials. Fortunately, at the moment the indicators are that the shortage is easing.”
