Civil contractor confidence falls to historic low in Q3 – CIDB

16th October 2018

By: Marleny Arnoldi

Deputy Editor Online

     

Font size: - +

The Construction Industry Development Board (CIDB) small and medium-sized enterprises (SME) business conditions survey has shown that civil contractor confidence fell by six index points to a historic low of 27 during the third quarter.

Weakness in all the underlying indicators, especially construction activity, contributed to the drop in confidence.

Discouragingly, CIDB said, demand for new construction work remained a constraint and implied that activity growth was likely to remain under pressure in the near future.

From a grades perspective, confidence fell to historic lows of 25 and 15 for Grades 5 and 6, and Grades 7 and 8, respectively. Respondents in these grades experienced a sharp slowdown in activity, which weighed on profitability.

Meanwhile, general building confidence has been trending downwards since early 2017. During the third quarter, business confidence shed three index points to 30.

CIDB monitoring and evaluation project manager Ntando Skosana noted that business confidence among general builders fell to its lowest level in almost seven years.

“Unfortunately, the outlook for this sector does not look promising, as the demand for new building work remains a constraint.”

She added that the third-quarter CIDB survey results suggested that pressure on smaller building contractors, in particular, is escalating. Since last year this time, business confidence for Grades 3 and 4 builders has dropped by a cumulative 19 index points to 28.

On a provincial level, the deterioration in sentiment for both general builders and civil contractors in the Western Cape was of particular interest.

“After outperforming other provinces for some time before this quarter, building and civil contractors in the Western Cape came under pressure, in line with other provinces.

“The fact that lower confidence was so pervasive across grades and provinces, highlights the broad-based nature of weakness in the building and construction sectors.” Skosana stated.

The CIDB SME business conditions survey is conducted quarterly among Grades 3 to 8 CIDB-registered contractors (categorised into Grades 3 and 4, Grades 5 and 6 and Grades 7 and 8), both for the general building and civil industries.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION