Strong final quarter expected

Construction products manufacturing returned to business as usual in Q3 after the weather-related pauses and subsequent catch-up in the first half of the year, according to the Construction Products Association’s latest State of Trade Survey.

Britain’s £56 billion industry is cautiously optimistic that the year will finish strong with sales anticipated to pick-up in Q4.

The survey reveals that product sales, which act as an early indicator of wider activity in the UK construction supply chain, increased in 2018 Q3. For heavy side manufacturers, 27% reported that sales increased, which was below the 40% that reported a rise in sales in a weather-boosted Q2, but in line with the average survey balance for 2017.

On the light side, which includes products such as insulation, boilers, glass and lighting, 27% of manufacturers also reported that sales rose, marking the first increase of 2018.

Manufacturers anticipate growth continuing in Q4, with 18% of heavy side firms and 43% of those on the light side expecting an increase in sales during the quarter. Manufacturers also reported that labour cost pressures began to subside in Q3. Two-thirds of heavy side firms reported an increase in wages and salaries, but this was the lowest balance since 2013 Q4. In contrast, cost inflation for fuel and raw materials remained elevated.