The construction industry worldwide is quietly confident about the 2010 despite the deepest recession for 60 years with most believing that profits will stay the same or increase by the middle of next year.
Almost two thirds of construction firms who took part in the annual global construction survey by KPMG were positive.
The research, covering 30 countries, found that the sector appears to have weathered the economic storm with 64% reporting business would stay the same or improve.
The longer term nature of many projects may have offered protection against the immediate impact of the recession, but that does not mean 2010 will necessarily be a good year, according to Fiona McDermott, KPMG’s head of building and construction for Europe, Middle East and Africa.
Commercial and residential property work has suffered as funding dries up in the wake of the global financial crisis, the report points out.
And McDermott warned that although the construction industry was reporting a relatively positive outlook, with around half of respondents reporting order books and profit at similar levels to a year ago, there may be worse in store for the industry later on.
‘Many companies are living off the profits of contracts secured before the recession, and whether such performance can be maintained is dependent on a number of factors, not least a general economic recovery,’ she said.
‘Although the sector appears to be in fairly good shape at the moment, we have to ask ourselves whether 2010 be the year that industry feels the pain already experienced by other sectors of the economy,’ she added.
The survey also found that the majority of respondents do not feel that government stimulus packages will bring a significant increase in opportunities in the next 24 months, with just 12% of worldwide respondents believing they will be of substantial help.
However, those respondents in Asia Pacific were much more optimistic than those in the rest of the world, with 82% of those in the region expecting a moderate or significant increase over the next 24 months.
Property price confusion clouds perception of real estate recovery in US, survey shows.[Property Wire News]