The outlook for the specialist sector is increasingly positive according to the latest NSCC State of Trade Survey, which shows a record high of 60% of respondents are anticipating an increased workload for the upcoming year.
Specialist contractors are seeing “tangible signs of more confidence in the industry” with 34% intending to expand their business in the next quarter and 33% expecting to take on more employees.
However, with 26% of respondents also indicating that they are experiencing increasing difficulty finding the right candidates for specialist work, the highest since Q2 2007, the question for many businesses is whether the growth is sustainable.
Late payment still a big issue
The impact of late payment on cashflow is however still adversely affecting contractors. The results of the quarterly survey reveal the extent to which the industry is still widely afflicted by the with 76% of respondents reporting payment between 30 and 60 days.
The Council is actively involved in the development of a construction supply chain payment charter and is committed to improving payment practices in the industry through its Fair Payment Campaign. In January the NSCC issued a comprehensive response with the full support of its members to the recent Government discussion paper, Building a Responsible Payment Culture. The Council has told that Government that poor payment practices, including lengthy payment terms, deliberate late and non payment and the unfair withholding of money, are endemic within the construction industry.
The response states:
“Legislation alone is not always the best driver for changing behaviour and the continued acceptance of poor or inappropriate behaviour perpetuates a culture of late payment. “
“This is currently highlighted by a tier 1 contractor that carries out a substantial amount of public sector work that has signed up to the Prompt Payment Code and is using Government money through the banking system to introduce a supply chain finance mechanism that extends payment terms to 120 days.”
In September 2013 the NSCC published guidance for specialist contractors on Carillion’s Early Payment Facility.
NSCC Chief Executive Suzannah Nichol MBE said:
“Given the improved outlook for Specialist Contractors, it is more important than ever that we safeguard the long term growth of the industry by investing in our workforce and ensuring fair payment practices are implemented throughout the supply chain.”
The National Specialist Contractors’ Council brings together 29 specialist trade organisations within the construction industry, representing some 7,000 UK specialist contractors.
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