GROWTH in Scotland’s construction sector stalled in the latest quarter amid the uncertainty caused by the Brexit vote but many firms expect to increase activity in the coming year, research has found.
The latest UK Construction Market Survey by surveyors body RICS found the overall workloads indicator turned slightly negative in Scotland in the three months to June ending a period of expansion which started in 2013.
The institute said the slowdown was visible in key sectors such as housebuilding with respondents only reporting modest growth in private commercial construction and infrastructure activity.
By contrast, respondents in all other parts of the UK continue to report a rise in workloads, although the growth rate slowed to a three year low.
Simon Rubinsohn, RICS chief economist, said the slowdown in growth recorded across the UK was not altogether surprising given the build-up to the referendum on the UK's membership of the European Union.
He said anecdotal evidence indicated uncertainty triggered by the Brexit vote could see some investment plans in the construction sector scaled back.
The survey was completed after the 23 June referendum.
However, Aberdeen-based surveyor Neil Donald said: “This slowdown has been coming for many months and the current political and economic uncertainty is clearly adding to this issue, but it is not the only factor in an economy still recovering from the last recession.”
Mr Donald’s comments underline the scale of the challenges faced by the construction sector following the slump in the housebuilding market triggered by the financial crisis of 2008.
The downturn in the oil and gas industry has created fresh complications for firms, particularly in north east Scotland.
RICs found that two per cent more respondents in Scotland reported a decrease in activity in the latest period than reported an increase
Some 21 per cent more respondents in Scotland expected activity to rise rather than fall over the next 12 months, compared with 23 per cent across the UK.
A balance of 11 per cent expected employment to increase rather than fall, against 16 per cent across the UK.
A balance of 17 per cent of respondents across the UK reported that activity increased in the latest quarter, down from 28 per cent in the preceding three months.
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