Construction jobs being added at a rapid pace

Confidence within the sector has surged as Omicron fears have dissipated

Employment in the panel of surveyed firms has been expanding month-on-month since April 2021. File Picture: Larry Cummins

The Irish construction sector saw growth accelerate at the start of the year as the Omicron wave passed and demand conditions improved. 

Rising workloads and a jump in business optimism led companies to ramp up their purchasing activity and take on extra staff. However, input costs continued to increase substantially amid severe disruption to supply.

The seasonally adjusted BNP Paribas Construction Index rose to 56.1 in January, up from 53.7 in December to signal a re-acceleration in the rate of growth in activity at the start of the year. 

Activity has now increased in nine successive months, with panellists mainly linking the latest rise to improving demand.

All three categories of construction recorded growth of activity in January, the third month running in which this has been the case. 

Commercial posted the fastest expansion as the rate of growth hit a three-month high.

The survey found that firms were at their most confident since the outbreak of the pandemic, with sentiment the strongest since August 2018. 

Some 57% of respondents were optimistic around the outlook.

John McCartney, director and head of research at BNP Paribas Real Estate Ireland, said the key signal emerging from Irish construction firms is confidence.

"Rising confidence can also be inferred from construction companies’ hiring behaviour. Employment in the panel of surveyed firms has been expanding month-on-month since April 2021, and the pace of hiring accelerated in January," he said.

"Employers generally only onboard extra staff when they are confident that activity will be sustained so this, along with further growth in new orders during January, augurs well for construction activity in the months ahead."