Q3 2023
Tender Price Indicator
With an economy that continues to flatline amid a stubborn inflationary backdrop, the bigger picture is one of a recovery that is likely to remain stuck in low gear as it battles a range of headwinds to growth.
Tight monetary policy, sticky inflation and restrictive credit and financial conditions will act as significant drags on growth in the months ahead, but despite all this, construction remains upbeat about its growth prospects. Although concerned about the UK economic outlook and the impact of rising interest rates, there are plenty of reasons to be positive.
Materials supply conditions continue to normalise, helping to moderate construction cost inflation pressures, while output and workloads on site remaining robust. Strong order books have also helped support recruitment activity and job creation, while fewer logistics bottlenecks and an improved balance between supply and demand has helped shorten lead times. Specialist labour supply remains tight with limited capacity driving higher wage rates.
All forecasts in this report take account of all sectors and project sizes as a statistical average, indicating an overall trend in pricing levels. It should be remembered that individual projects may experience tender pricing above or below the published average rate, reflecting the project specific components and conditions.