Sector insight: Engineering, construction & infrastructure

Trends in the international construction market

From recent reviews of the global construction market, we have identified four key themes which are impacting all major suppliers across the market. 

We highlight four key global themes we see in the market, for discussion

Continued pressure in developed markets

Firms are continuing to diversify, both geographically and sectorally to find growth (often through M&A)

Firm economics are under continuing pressure

Volatile capital programmes impact cash flow and utilisation rates

Increasing use of integrated contracts

Engineering only firms risk being increasingly pushed into sub-contractor role (potentially further pressuring economics)

Supplier consolidation

Markets (particularly developed) becoming increasingly consolidated through M&A and market pressure

Globalisation of workforces

Firms without low-cost delivery centres and multi-site delivery are losing out on cost and staff flexibility

We believe that these trends will shape the development of the construction industry during the global economic recovery.  The firms which perform strongest will be those that have the appropriate strategies to anticipate them.

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