Construction industry faces challenges in rebuilding Ireland post-Covid

Construction industry faces challenges in rebuilding Ireland post-Covid
Douglas Village Shopping Centre site where reconstruction work was taking place following last year’s fire. Construction activity is to resume in Ireland on May 18. Picture: Eddie O’Hare

The majority of construction companies in Ireland expect to operate sub-optimally for at least 12 months, a survey by the Construction Industry Federation (CIF) has found.While the sector was one of the last parts of the economy to shut down and is set to be one the first to open back up again on May 18, the CIF said the Covid-19 pandemic has left a deep scar will take at least 12 months before they recover fully.

The construction industry will be carrying out site safety assessments to ’’covid proof’’ construction sites around the country to prepare for a gradual return to work. This will involve putting in place extra hygiene facilities, adding safety modifications on sites and carrying out essential maintenance.

More than 50% of those surveyed (52%), will expect the results of the pandemic on their business to be dire. One fifth (20%), expect the pandemic to hit their bottom line by 40% with the majority (32%), expecting this figure to be in and around 30% - almost a third.

The CIF Director General Tom Parlon said construction companies have seen 100,000 of their workers lose the jobs in the past month.

"This survey lays bare the impact of Covid-19 on the construction industry. As the first sector to be allowed back to work, it’s critical that the construction industry can remobilise quickly so it can begin to benefit the wider economy."

"The Government has made significant efforts to support businesses which are to be lauded. We’re heartened by the Government’s commitment to maintain strong investment in public infrastructure such as roads, schools, rail, hospitals, housing and other vital societal construction," he said.

To support the sector the CIF wants the government to provide flexibility to state bodies to collaborate with contractors on public sector projects in sharing the burden of implementing Covid-19 safety measures. They said this will help avoid costly dispute and delays between the State and industries.

The CIF said there also needs to be an acceleration of house-building both social and private and bing forward preparatory works on critical infrastructure as set out in the National Development Plan and Project Ireland 2040.

In preparation for the reopening of sites next Monday CIF members will be asking their employees to undergo an online safety induction programme with more than 75,000 workers having already done so.

The CIF said Ireland was the only country in the EU to completely shut down all sites.

"This survey shows the struggles that the construction industry faces. From cash flow issues and legal disputes to productivity challenges, the industry will need time to adjust and recover," Mr Parlon said.

"The construction industry has a vital role in driving Ireland’’s economic recovery by getting people back to work and delivering the housing and infrastructure this country requires to move forward through this pandemic."

Separately, Ulster Bank published its Construction Purchasing Managers today which highlights the collapse in the building sector.

The seasonally adjusted index designed to track changes in total construction activity fell to just 4.5 in April, well down on the reading of 28.9 in March and by far the lowest since the survey began in June 2000. 

Index readings above 50 signal an increase in activity on the previous month and readings below 50 signal a decrease.

The vast majority of survey respondents (nearly 93%) reported a reduction in business activity from March, reflecting widespread site closures with around 95% of respondents reporting a fall in commercial activity, while 93% of respondents reported a drop in housing activity.

However, confidence about the coming year rose slightly in April, an outcome likely reinforced by the post-survey government announcement that a phased return for construction will be allowed from Monday which may mean that April proves to be the nadir of the current crisis for Irish construction firms.

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