In the global recession, few sectors have been worse hit than the construction industry. Industry experts and company leaders are desperate for certainty in what looks likely to be an equally challenging 2010. Global construction consultant Davis Langdon has released a 10-point charter – making some bold predictions about life in 2010 and how construction companies can do business in the ‘new normal’ by tackling the uncertainty head on.
The charter, which was put together by the firm’s Head of Professional Development, Simon Rawlinson, and one of its Construction Economists Maren Baldauf-Cunnington, focuses on 10 key points which Davis Langdon believes will determine progress in the economy and demand for construction over the next 12 months. Simon comments: “2010 is the year during which UK construction and its clients must prepare for recovery. The future will be characterised by much tighter finances, so organisations that can maximise the use of existing and new assets will be well placed for success in this environment.”
After the extraordinary events of 2008 and 2009, the charter predicts that 2010 will dish up fewer shocks – however we now have to consider the ‘known unknowns’– such as the ballooning budget deficits in economies like the UK – and how these have to be addressed. Withdrawal of stimulus and the start of spending cuts are considered – as well as how mergers and acquisitions are back on the agenda for 2010. With the VAT rate in the UK back up to 17.5% it considers how QE policy and interest rates in 2010 could have long-term implications for both inflation and the creation of future asset bubbles. The charter also looks at how the Pound is likely to be dogged by sovereign debt concerns in 2010, and finally how stalled World Trade talks in 2009 will resume in 2010, with the success and failure of the world’s diplomats and negotiators needing to be a keynote for 2010.
In short, the concluding outcome is that foundations are being set for the upturn with improved prospects for the future. But a future that looks very different to conditions we were used to five years ago. Amongst the gloom, organisations that are comfortable with uncertainty, ready for recovery and are able to deal with opportunity will thrive in the ‘new normal’.
To read the 10-point charter in full entitled ‘Major Drivers of the Economy and Construction in 2010’ click here or see the attached pdf.
