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Good growth forecast for plumbing contractors market in 2015
The plumbing contractors market was estimated to be valued at around £14.7bn in 2014, having seen good levels of growth over the last two years, notes AMA Research in its latest publication: 'Plumbing Contractors Market Report - UK 2015-2019 Analysis.'
The plumbing contracting sector weathered the economic downturn fairly well compared with other construction sectors, due to the fact that a large share of work is made up of repair and maintenance, which is generally more resilient than work within the newbuild sector.
In addition, plumbing installations cover a number of non-domestic sectors, in addition to housing, and some of these, in particular the public sectors, continued to perform relatively well into the recession due to continued government investment to support the construction industry.
The market experienced a slight improvement in 2010 and again in 2011, however, value was inflated by widespread material cost increases within some plumbing product sectors, particularly those related to copper. In addition, spending cuts within the public sector had started to come into effect and the value growth could not be sustained, leading to a decline in the plumbing contracting market during 2012.
The situation was more positive in 2013 and while the economic situation remained relatively fragile, there were positive signs during 2014 - business confidence improved and construction activity increased sharply, particularly in the housing sector.
The key occupational roles across the plumbing contracting sector include general plumbing and bathroom installations (mostly domestic), gas installation and maintenance, refrigeration and air conditioning, and heating and ventilation.
Employment in the plumbing and heating sector is expected to increase across England, Scotland and Wales. There are currently skills shortages for fully qualified plumbers, which should increase labour costs and support value growth across the contracting sector in the short to medium term.
Future prospects for the plumbing contracting market are relatively bright, providing the construction market in general continues to improve. Indications for 2015 are positive and it is hoped the market will achieve value growth of around 6% during the year. While the pace of growth is likely to have slowed by 2016/2017, it is expected that the plumbing contracting market will be worth £17.1bn by the end of the forecast period.
"Opportunities for growth are likely to be found in the new housing sector, which is currently being driven by rising prices, increased mortgage lending, as well as a growing uptake of the government's 'Help to Buy' programme" says Keith Taylor, Director of AMA Research. "In the existing housing sector, the changes to the stamp duty levels along with growing consumer confidence and spending, should support increased RMI expenditure."
It is likely that as the economy improves and consumer confidence grows, an increasing number of consumers will begin to focus on higher value, big ticket projects such as kitchens and bathrooms. This is perhaps already the case in London and the south east and other areas which have experienced high property value growth. Other potential areas of growth include the installation of additional bathrooms, e.g. en suite and cloakrooms into properties, along with kitchen extensions and utility rooms.
The report is available now.
T: 01242 235724
6th March 2015