Steel’s sustainability and flexibility will score with clients
At this time last year, looking ahead to 2022, we said that there was a lot of evidence suggesting that the outlook for the economy was positive for the next couple of years. Encouraging messages came from the two main official forecasters – the Office for Budget Responsibility and the Bank of England – and the Confederation of British Industry said business investment plans were strong.
A lot happened since then to dampen the optimism, notably the energy prices shock caused by Russia’s unprovoked invasion of Ukraine, and the upheaval caused by the demise of one UK prime minister and the economic ructions following the short-lived appointment of his successor, whose high spending-tax cutting plans were not well received in financial markets.
The COP26 event in Glasgow was about to be held, highlighting for anyone who still needed convincing that the planet is engaged in a desperate battle to tackle climate change. The implications for construction are profound and the industry has reacted positively to the clarion calls for change.
The steel construction sector was well up with events with publication of the net zero carbon 2050 Roadmap just months before and the NSSS Annex J Sustainability Specification soon after. The story for the next few years will be how positive responses are turned into carbon reduction action, and further sustainability initiatives will be announced by the BCSA during 2023.
What can be left of last January’s optimism though? Quite a lot in fact. Construction output rose in October for the fourth successive month, according to Office of National Statistics figures released in December, against the headwind of an overall fall in the economy. There was a three month fall in the wider economy’s output, but for the most recent month, October, the economy was back on a growth tack. The rise in construction output and in the wider economy is small, but considering the forces against growth prospects it is encouraging that things seem to be moving in the right direction.
The headwinds are still there, generated by a wide range of factors like inflation, the end of the era of cheap money, and skills shortages. The economy looks like heading into a recession, one that it is hoped will be relatively mild and short-lived. But not a lot of smart money will be betting against an industry that has shown such strong resilience so far.
What of the steel construction sector’s own prospects? In a world where employees seem increasingly to have to be coaxed into working from the office at all, building owners are understandably wary of being left with ‘stranded assets’ as the demands of users shift. One response to that is creating a demand for refurbishing and repurposing buildings to create more pleasing work environments. Owners of steel-framed buildings will find themselves in a relatively much more fortunate position than others due to the flexibility afforded by column-free spaces.
A lot of new build will still take place and developers will surely take note of steel’s flexibility to cope with changing requirements and procure buildings accordingly. Steel’s strong sustainability messages, as well as its relative cost-effectiveness, will increasingly come to the fore as procurement focusses more and more on sustainability.