Construction Downturn: Northern Ireland

Construction is going through a difficult period in Northern Ireland. Recent reports suggest that output fell by 7 per cent in the second quarter.

Yet some sectors are starting to show improvement. For example, the value of construction starts in the education sector is set to be particularly strong this year.

In addition, there has been an increase in starts in Northern Ireland's relatively small industrial and hotels sectors. Based on these factors, Glenigan estimates the value of construction starts will increase by 13 per cent in 2008.

Looking forward, prospects for Northern Ireland appear to be improving. Between January and July 2008, Glenigan recorded a 32 per cent increase in planning approvals for projects with values of less than £100 million.

Strong public sector spending combined with a more optimistic business outlook has led to an increase in approvals across a range of sectors.

While tighter credit market conditions may threaten some projects, the leading indicators suggest that Northern Ireland's construction industry might be about to turn the corner.