Construction News reports that almost 4,500 construction firms have fallen into financial distress in the third quarter of 2020. The Construction Index reports that profit warnings from stock market listed construction companies have reached a record high:
Most of these warnings (60%) have come from the building materials subsector, as the impact of Covid-19 travelled through the supply chain, rather than from contractors and engineers as found in previous years.
Meanwhile, today’s Bank of England forecasts show that hopes of a V-shaped recovery have faded. The Bank now predicts the UK economy will shrink by 11% this year – including a 2% contraction in October to December.
Bank of England’s latest forecasts show that economy is set to contract again as England locks down. Activity is still massively depressed and unemployment set to continue rising. Bank expects that 5.5 million people will be furloughed in November. pic.twitter.com/YR98GKHbFB
— Joel Hills (@ITVJoel) November 5, 2020
Another striking characteristic of today’s @bankofengland projections is that UK GDP, or national income, is set to shrink by 11% for the whole of 2020, a record. We are losing more than one in every ten pounds of our income, one of the worst performances in the world: the...
— Robert Peston (@Peston) November 5, 2020
In the world of aggregates, the Mineral Products Association points to a recovery over the summer, but now has concerns about winter order books.
Increased summer demand for mineral products gives way to winter concerns https://t.co/EiD2fthmlq #MPAEconomics #MineralProducts pic.twitter.com/BFVyjGNjwk
— Mineral Products Association (@MineralProduct) November 3, 2020
In the third quarter of 2020, sales volumes were 1.1% lower for asphalt than in the same period in 2019, 6.8% lower for primary aggregates, 14.2% lower for mortar and 14.3% lower for ready-mixed concrete. Industry data on contracts for new construction projects suggest work may be feeding through, but heavy-side building material producers have yet to see a significant pick-up in orders.
