Scottish Construction Sees Cautious Growth

Government and public sector funders in Scotland are being urged to provide a sustained approach to public sector construction investment, as new figures published today from the Construction Skills Network (CSN) forecasts cautious growth in 2010.

The annual CSN report, produced by ConstructionSkills, the Sector Skills Council for the construction industry, shows that the Scottish construction industry is expected to be one of the better performing regions and nations, with an annual average growth rate of 2.8%, behind only the East of England. This figure is also substantially stronger than the projected UK figure of 1.7%.

Growth is expected to return in 2010, with output increasing by 3%. Further moderate growth of 4% is forecast in 2011, giving an annual average growth rate over the two years of 3.6%.

Employment is also likely to return to growth in 2010 in Scotland, with total construction employment in Scotland forecast to reach around 257,000 in 2014, a figure which is almost 9% higher than the projected total for 2010, and 1% above 2008’s total.


The key findings in the report highlight that the strongest sector in Scotland will be the private housing sector, with an annual average growth rate of around 10%, significantly more buoyant than the next strongest sector, public housing.

However, while the recovery in private housing is likely to be fairly strong throughout the 2010–2014 period, the public housing sector is expected to see substantial growth in the short term.

There are noticeable differences in the structure of the Scottish construction sector and that of the UK. One of the major differences is the importance of infrastructure in Scotland, accounting for 13% of construction output compared with a UK figure of just 7%.

Infrastructure output is currently driven by Transport Scotland's investment programme, which is continuing apace. There are a number of major programmes of work underway, including the Edinburgh tram project and the Airdrie-Bathgate Rail Link project.

A number of significant road schemes are also providing a stream of output with completion of the M74 and the upgrade of M80 progressing while work on the A90 Aberdeen Western Peripheral Route is due to start in 2011.

Graeme Ogilvy, director for ConstructionSkills in Scotland said: "The recession has hit businesses within the construction across the UK extremely hard and the forecast recovery is likely to be long and slow. In Scotland, our figures show cautious optimism and it is interesting to see the areas in which we are leading the pack.

"The infrastructure work taking place, such as the reinstatement of the Airdrie-Bathgate Rail Link, is an incredibly positive thing for Scotland and although total new construction orders declined in 2008, new infrastructure orders rose by 55% to a record high of £987m."

(GK/BMcC)