In November, the RIBA Future Trends Workload Index fell by 1 point to a balance figure of -21. In the next three months, 12% of practices expect workloads to increase, 34% expect workloads to decrease and 54% expect them to remain the same.
All the monitored work sectors remain in negative territory, with private housing the lowest at –21, down 4 points from October. 32% of practices expect their workloads in this sector to deteriorate over the next three months. The commercial and community sectors also fell a further 4 points this month, posting –12 and –14, respectively. The public sector is the only sector to show some improvement, posting a figure –10, up by 2 points from October.
The outlook among small practices (1 – 10 staff) has broadly held steady, with a score of -25, up from -26 last month. 35% of small practices expect workloads to decrease, whilst 11% expect them to grow. Overall, large and medium-sized practices (11+ staff), have dipped into negative territory this month, returning a balance figure of –2, down from +15 in October. Large practices (50+ staff) remain more pessimistic about future work than medium sized practices (11 to 50 staff).
Confidence continues to be weak across the country, with all regions posting negative figures. However, there are some signs of positivity; London has posted a figure of –26, up by 6 points from October. And in the Midlands & East Anglia, there are signs of improvement too, posting a score of –21, up by 2 points. All other regions have however fallen further into negative territory – South of England (-35), Wales & the West (-26), and the North of England (-22).
In terms of staffing:
- After signs of recovery in October, when the Future Trends Permanent Staffing Index stood at zero, in November, it returned to negative territory, posting a figure of –6.
- 11% of practices expect to employ fewer permanent staff over the coming three months, and 6% expect to employ more. 83% expect their permanent staffing levels to stay the same.
- The proportion of practices anticipating falling workloads (34%) exceeds the proportion expecting staff reductions (11%).
- Medium and large-size practices (11+ staff) now have a negative outlook for future staffing levels, with a combined Staffing Index figure of -10. Small (1 – 10 staff) practices continue to expect falling permanent staff numbers with an Index figure of -5.
- Across all regions, the outlook is poor. London is the most likely to see a fall in permanent staffing levels, down 10 points this month to -13. The Midlands & East Anglia (-5) and the North of England (-4) also remain in negative territory. After posting positive figures in October, Wales & The West ( -5) and the South of England (-5) have now fallen into negative territory.
- The Temporary Staffing Index fell by 5 points in November to -6.
- Levels of personal underemployment have increased, with 21% reporting personal underemployment, compared to 13% in October.
RIBA Head of Economic Research and Analysis, Adrian Malleson, said:
“With no growth anticipated in any of the monitored regions or sectors – the profession’s confidence remains low.
Whilst the rate of deterioration has slowed – the index dropped by just one point this month – workloads are significantly lower that they were a year ago – down overall by 8%.
Time and again, practices report that local planning delays are causing projects to slow, stall, or be abandoned altogether. There are reports too that the latest hike in interest rates has also caused planned funding for some projects to fall through.
As a recession looms, the sector continues to grapple with rising inflation and material and constructions costs alongside a scarcity of tradespeople.
Small-scale domestic work has been hit particularly hard. With people having less disposable income, and mortgages now either unavailable or too expensive, architects are receiving fewer new enquires, a reduced pipeline of work, and increased pressure on fees. In contrast though, some practices describe how some project types, including high-end domestic projects and retail-supporting warehouses, continue to provide a steady stream of work.
During these turbulent times, we will continue to prove high quality support to our members – so they can adapt and innovate their business models. As always, we will report our findings to the Government and work with other built environment bodies to monitor ongoing trends.”