Shaky structure: Growth is expected to slow in 2017-18 as uncertainty limits investment

The Commercial Building Construction industry's performance is contingent on various external factors, particularly cyclical fluctuations in the UK economy, private investor sentiment, and government funding for social infrastructure. Over the past five years, industry operators have recovered from a period of turbulent operating conditions in the aftermath of the financial crisis, owing to strong business confidence, robust demand for landmark office developments, and renewed public sector funding commitments for health and educational facilities.Stable economic growth has supported rising business capital expenditure for much of the past five-year period, boosting demand for retail and office spaces...read more.

Industry Statistics & Market Size
Revenue
$18bn
Annual Growth 13-18
2.6%
Forecast Growth 18-23
Profit
Employment
87,539
Businesses
12,243

Industry Threats & Opportunities

  • Economic uncertainty stemming from the EU referendum is expected to slow revenue growth
  • The average industry wage is forecast to continue increasing due to a shortage of skilled labour
  • Declining consumer confidence may weigh on demand for retail developments in the short term
  • Industry Report - Industry Analysis Chapter

    The UK construction sector is procyclical, meaning that its performance is highly contingent on fluctuations in the wider UK economy, the level of private investor sentiment, and the public sector’s propensity to spend on socially beneficial projects. In recent years, relatively stable economic growth has supported construction activity and induced demand for commercial buildings. While the start of the past five-year period was characterised by the faltering economic recovery, rejuvenated business expenditure, robust business confidence and long-term investment plans by large developers have been crucial in supporting growth in the Commercial Building Construction industry. Over the five years through 2017-18, industry revenue is forecast to increase at a compound annual rate of 2.6% t...purchase to read more.

    Additional Insights for the Commercial Building Construction Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Commercial Building Construction Industry are

  • Ability to compete on tender
  • Having good working relationships with subcontracting building trade specialists
  • Having links with suppliers
  • IBISWorld analysts also discuss how external factors such as Business capital expenditure and Demand from building project development in the Commercial Building Construction industry impact industry performance..

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    What's in this report

    What is the Commercial Building Construction Industry?

    This industry consists of firms that construct non-residential buildings to sell on their own account or on a fee or contract basis. This includes schools, hospitals, stores and airport buildings. The assembly and erection of prefabricated buildings is also covered. Repairs and maintenance are also included in the industry. Part or all of the construction process may be outsourced.

    Industry Products
  • Offices
  • Educational buildings
  • Health-care buildings
  • Retail buildings
  • Entertainment and recreation buildings
  • Industrial buildings
  • Other non-residential buildings
  • Industry Activities
  • Constructing industrial buildings
  • Constructing institutional buildings
  • Constructing, office and other commercial buildings
  • Constructing recreation and entertainment facilities
  • Constructing educational and health related facilities
  • Assembling and erecting prefabricated non-residential buildings
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Business capital expenditure
  • Demand from building project development
  • Business confidence index
  • Real private consumption expenditure
  • Construction materials price index

  • Current Performance
  • Retail and office
  • Education and health
  • Business cycle
  • Chart: Revenue Growth

  • Industry Outlook
  • Private sector
  • Public funding
  • Development opportunities
  • Table: Commercial Building Construction Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Commercial Building Construction Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Building Project Development
  • Department Stores
  • Warehousing & Storage
  • Primary Education
  • General Secondary Education
  • Universities
  • Hospitals

  • Key Selling Industries
  • Architectural Activities
  • Bricklaying & Other Specialised Construction Services
  • Cement Manufacturing
  • Construction Equipment Rental & Leasing
  • Construction Supplies Wholesaling
  • Consultant Engineering Services
  • Mining, Construction & Civil Engineering Machinery Wholesaling
  • Ready-Mixed Concrete Manufacturing

  • Products & Services
  • Offices
  • Educational buildings
  • Entertainment and recreation buildings
  • Retail buildings
  • Industrial buildings
  • Health-care buildings
  • Other non-residential buildings
  • Chart: Commercial Building Construction Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Private sector - new construction
  • Public sector - new construction
  • Private sector - repairs and maintenance
  • Public sector - repairs and maintenance
  • Chart: Major Market Segmentation for the Commercial Building Construction Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitSubcontractor paymentsWagesPurchasesOther costs
  • Chart: Cost Structure Benchmarking – Sector vs Commercial Building Construction

  • Basis of Competition
    Internal competitionExternal competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Commercial Building Construction Industry

  • Industry Globalization
    Kier Construction Limited, Morgan Sindall Group plc,
  • Table: Kier Construction Limited - financial performance
  • Table: Morgan Sindall Group plc - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Commercial Building Construction Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Commercial Building Construction Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Building Schools For The Future
  • An investment programme launched by the previous Labour government aimed at upgrading or replacing secondary school buildings in England.
  • Private Finance Initiative (Pfi)
  • Where private capital is used to fund public infrastructure and building developments in return for the asset being partly privatised. It is a means of developing PPPs.
  • Public-Private Partnership (Ppp)
  • An agreement between a public agency and a private company to share their skills, assets and financial resources to deliver a building for public use.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Commercial Building Construction market research report offers insightful industry analysis and research into the market at the national level. IBISWorld’s in-depth industry market research is presented in a logical and consistent format. The industry report contains key industry statistics, market size, industry trends, and growth and profit forecasts for a 5-year outlook period.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Commercial Building Construction:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Commercial Building Construction market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Commercial Building Construction, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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