RIBA Future Trends Survey for May 2015 – growth predicted despite fall in public sector workloads

The RIBA Future Trends Workload Index was virtually unchanged in May 2015 (at +37, up from +36 in April). Practices in the north of England (balance figure +50), Wales and the West (+44) and London (+40) are the most optimistic about future workloads.

Medium-sized practices (11–50 staff), with a balance figure of +54, continue to be the most optimistic about future growth; small practices (1–10 staff) and large practices (51+ staff) also remain positive about the outlook for future workloads (balance figures +35 and +33 respectively).

The private housing sector forecast fell slightly in May (to +34 from +38 in April). This month also saw the public sector forecast move into negative territory for the first time since July 2014 (down to -1 in May 2015, from +3 in April). Our respondents anticipate public sector spending on building projects to be flat at best over the coming quarter.

More positively, the commercial sector forecast increased to +21 (from +15 in April), while the community sector forecast made a recovery from its recent decline (rising to +4 in May from -3 in April).

The RIBA Future Trends Staffing Index fell slightly to +16 (from +18 in April 2015), with medium-sized practices the most confident about increasing their staff over the next quarter (+55). For large practices, the balance figure for May was a healthy +50; small practices remain significantly more cautious at +8.

Overall, 17 percent of participating practices expect to see an increase in temporary staff over the next quarter whilst only 2 percent anticipate employing fewer permanent staff over the same period. Just 12 percent of respondents said that they had personally been under-employed in the last month. Practices also reported that they currently employ 5 percent more students (year out or post-Part 2) compared with the equivalent period last year.

RIBA Director of Practice Adrian Dobson said:

“Our employment index has been in very positive territory for some time and there is every indication that the employment market for salaried architects will remain strong over the coming quarter.”

“Our practices expect the commercial sector to perform well during 2015, led by the office and leisure markets. Despite a slight dip in the private housing sector forecast, possibly associated with decreased house building around the recent General Election, it remains the best performing of our sector forecasts.”

“We continue to receive reports that clients remain resistant to increases in fee levels, leading to tight profit margins on many projects. However, as the employment market becomes more competitive, we would expect to see greater salary expectations along with more general economic growth bringing some upward momentum to fee levels.”