Tender Price Index Shows Contractors Are Soaking Up Increased Prices

In a bid to win more work, contractors are showing willing by soaking up increased costs.

Figures released by the Royal Institution of Chartered Surveyors as part of their Tender Price Index shows a minimal increase in building costs of just 0.3%. The Building Cost Information Service have said that they expect these figures to begin to rise again in 2014 with slightly higher than expected rises in 2015 and 2016.

Employment figures in the construction industry show few signs of major improvement. Employment did rise but only by 0.2% and just 2% of contractors have said that they have been unable to hire skilled workers.

Prior to the recession, the number of companies struggling in this way was more like 60%. It is believed that contractors’ willingness to soak up these costs is a move that is aimed at encouraging clients to sign up for projects therefore ensuring work.

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