North West construction sector: stamina and persistence required to maintain Covid recovery

The construction sector can overcome the economic challenges of coronavirus but it is likely to be a long road to full recovery.

That’s according to a survey of 100 construction companies across the UK, compiled in association with Lancashire-based accountants and business advisers MHA Moore and Smalley.

The MHA Construction Sector Report 2020 found that while 71 per cent of companies who have used the Government’s furlough scheme planned to bring back all furloughed staff, 32 per cent of companies surveyed had been forced to make redundancies.

And while 44 per cent of those surveyed said coronavirus was having minimal impact on their business, 49 per cent claimed the impact was substantial, with 30 per cent believing it would be more than a year before business returned to pre-pandemic levels.

Joe Sullivan, partner at MHA Moore and Smalley’s Preston office said:

“The fact that the majority of firms using the furlough scheme plan to bring back all furloughed staff is a positive sign. However, the sector’s future is currently very uncertain.

“Government projects are now the most likely source of revival. Housebuilding, although buoyed by strong demand, is likely to suffer from a rise in unemployment. Commercial building is unlikely to thrive, with many companies questioning whether they need as much office space as before.”

He said with the stark contrast between companies who had felt minimal impact from coronavirus and those claiming the impact had been substantial, any future government relief must be properly targeted.

Joe added:

“Not everyone needs help and there is no blanket solution for the companies that do need assistance. In particular, the government needs to be mindful that big infrastructure projects tend to benefit larger companies the most, and even disadvantage small ones by sucking in materials and labour.”

The biggest concern, shared by 61 per cent of respondents, was economic uncertainty. Supply chain disruption also ranked high on the list of worries, mentioned by 45 per cent of respondents.

The vast majority of respondents have used of some form of Government support. 81 per cent have used the furlough scheme and 68 per cent have used the VAT deferral scheme.

However, take up of other schemes was much lower, with only 13 per cent making use of the Coronavirus Business Interruption Loan Scheme (CBILS) and 12 per cent taking advantage of the Bounce Back loan scheme.

The MHA Construction Sector Report 2020 can be viewed here.

MHA Construction and Real Estate Report 2020

The latest MHA Construction Sector Report shows a stark divide in today’s Construction sector, between those who were able to capitalise on the opportunities presented by COVID-19, and those who struggled to finance their way through lock down.

To compile the report, the national Construction team at UK accountancy association MHA benchmarked construction businesses across the UK to paint a national picture of the sector entering lockdown in March. It also revealed the results of the survey taken this summer to gauge the response of businesses currently responding to COVID-19. Finally, the Report highlights any regional projects or significant issues that may shape local responses.

Key findings

  • The industry entered 2020 with strong balance sheets, increased turnover (8.3%and low debt risk. The largest businesses saw the greatest increase in revenue from the previous year.
  • Employment across the sector grew by 3.6%.
  • The industry is evenly split between businesses with a substantial or critical impact due to COVID-19 (54%), and those with little to no impact (46%).
  • More than half of those surveyed said infrastructure spending should be the Government’s top priority for the sector.
  • Nearly 4 out of 5 respondents said the single biggest factor holding back growth was economic uncertainty.

By providing this snapshot into the sector’s conditions, we aim to showcase ways in which the Government can provide the financial and other support the sector needs to not just survive but thrive in 2020 and beyond.

Click here to download a copy of the report.

Further information

However, if you have any questions in the meantime, or would like to discuss the results in more detail, please contact our sector head Joe Sullivan.

Other blogs in this series

MHA Construction Sector Survey Results: Technology

What impact has COVID had on technology and innovation in the UK construction industry?

MHA undertook a survey into the Construction & Real Estate sector focusing on the impact of COVID-19, and how this is affecting construction firms.

The results report on 2 key areas including:

  1. Technology used prior to COVID-19
  2. Claiming R&D Tax Relief
Implementation of new technology

We have summarised the results into easy to read infographics which can be found on the MHA website link attached

Further information

However, if you have any questions in the meantime, or would like to discuss the results in more detail, please contact our sector head Joe Sullivan.

Other blogs in this series

MHA Construction Sector Survey Results: Employment

Do construction businesses have access to the labour they need?

MHA undertook a survey into the Construction & Real Estate sector focusing on the impact of COVID-19, and how this is affecting construction firms.

The results report on 4 key areas including:

  1. COVID-19 workforce reduction,
  2. Percentage of EU citizens for on-site workforce,
  3. Will IR35 impact employment,
  4. Increase in labour requirements within the year,

We have summarised the results into easy to read infographics which can be found on the MHA website link attached


Further information

However, if you have any questions in the meantime, or would like to discuss the results in more detail, please contact our sector head Joe Sullivan.

Other blogs in this series

MHA Construction Sector Survey Results: Funding

MHA undertook a survey into the Construction & Real Estate sector focusing on the impact of COVID-19, and how this is affecting construction firms.

The results report on 6 key areas including:

  1. Sources of funding,
  2. Ease of accessing funding today compared to pre-COVID,
  3. Applying for CBILS and CLBILS funding,
  4. Accessibility of Government funding,
  5. Lack of funding impacting
  6. Work capacity, Need for sector specific funding scheme
Finding funding in Covid-19 Pandemic

We have summarised the results into easy to read infographics which can be found on the MHA website link attached


Further information

However, if you have any questions in the meantime, or would like to discuss the results in more detail, please contact our sector head Joe Sullivan.

Other blogs in this series

MHA Construction Sector Survey Results: COVID-19

What impact has COVID-19 had on construction businesses in the UK?

Our MHA Construction & Real Estate team recently undertook a nationwide survey into the Construction & Real Estate sector focusing on the impact of COVID-19, and how this is affecting UK construction firms. The results report on 5 key areas including the impact of COVID, Changes in activity levels, Challenges faced, Government support and staffing levels.

We have summarised the results into easy to read infographics which can be found on our MHA website here.

These findings will be explored further in a special state of the UK construction industry in the Report, due out at the end of September. The report will look at the state of the construction sector going into the COVID pandemic, analyse how the sector is responding to current challenges, and anticipate the way forward for the industry.


Further information

However, if you have any questions in the meantime, or would like to discuss the results in more detail, please contact our sector head Joe Sullivan.

Other blogs in this series:

Real Estate Matters – Issue 16 now available

We have worked together with our colleagues across MHA to provide a national outlook on the issues facing the construction market. The series of informative articles are designed to help you better understand the changes happening within the Construction and Real Estate sectors, which is particularly important during these unprecedented times.

The impact of COVID-19 continues to impact the national and international economy, with major implications for construction and real estate businesses across the UK. Earlier in the summer, Chancellor Rishi Sunak announced further measures to support the economy in his Economic Update, with a number of initiatives designed to boost the construction sector.

This edition focuses on:

  • Economic update overview
  • Green Homes Grant and VAT
  • Success with long-term contracts
  • Determining compensation for land
  • Property pensions
  • Latest construction news

To download a copy of the report please click here.

If you would like any further information on any of the topics, please contact Joe Sullivan on 01772 821021.

Summer Economic Update

Summer Economic Update

8 July 2020

The key points and changes from Rishi Sunak’s summer statement

Summer Economic Update

The 2020 Summer Economic Update is unique for both its timing and its focus on what measures will be implemented to help the economy bounce back from the impact of Covid-19.

Summer Economic latest updates

Our new blog details the changes from a Tax perspective, including VAT, Eat Out to Help Out scheme, Job Retention bonus and much more.

This easy to read infographic summarises the key points from the recent economic update.

Tony Medcalf Video Review

Tony Medcalf, head of Tax gives a short five minute overview of what the Summer Economic update means for you and your business.

Sector specific news

Some of the measures announced yesterday directly impacted the leisure and tourism sector. Here is our overview of what it means for businesses operating in the sector.




Summer Economic Webinar

Professor Joe Nellis, Global Economist from Cranfield University will be providing his view on the future outlook for the UK and global economy post-Covid-19, and also the longer term impact of the Government’s unprecedented stimulus packages. He will also be taking live questions afterwards.

Summer Economic VAT Update Webinar

In our latest VAT Webinar, Jonathan Main analyses the recent Summer Economic Update from Rishi Sunak, focusing on how the update mainly affects the Leisure and Tourism sector. As well as other pressing VAT issues and news including, Time To Pay (TTP), Trapped VAT, VAT Accruals, Bad Debt Relief and much more.

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