A glance at the 2020 performance figures for the UK suspended ceilings and partitioning sector reveals an industry seemingly experiencing a slow decline. In a market like so many others, reeling from the impact of the coronavirus pandemic, revenues for 2020 were valued at around £283 million – which represents a fall of 16% when compared with market figures for 2019.
Covid-19’s influence on the UK market
Covid-19 seems to have been a tough challenge for forecasters and market analysts. Partly due to the nature of the suspended ceilings and partitioning industry, the pandemic’s influence was a slow-burn event which was both difficult to track and surprisingly awkward to evaluate without some preliminary explanation.
Generally speaking, the UK market for suspended ceilings and partition products is sophisticated, cyclical and predictable. Non-domestic sector operations are well-established. So, like many similar expert installers, Western Industrial commented that their order book continues to feature refurbishments and construction projects focused on office suites, educational institutes and retail businesses, alongside entertainment & leisure complexes and healthcare properties of all kinds.
As would be expected, the work of fitting of suspended ceilings tends to take place during the final phases of most kinds of construction project. And often, the final partitioning work is even further delayed until commercial clients have finalised their floor plans and are almost ready to take charge of the buildings. Thus, while coronavirus quickly caused problems for some trades and construction operators, its influence on ‘near final fix’ jobs was more random and inconsistent.
Performance statistics for the sector evidence this effect: The market was clearly experiencing normal growth patterns up to and including 2018. With the benefit of hindsight, 2019 was a period of relative coasting with business activity merely ticking over. All this activity then came to a sudden stop in 2020 with sweeping public health dictats preventing most manual construction work.
Momentum slowly returns to the market
As with many other industries, the first lockdown (March, 2020) initially decimated construction. And with coronavirus infections spiralling upwards, a total shutdown soon followed.
Nevertheless, the graduated easing of lockdown measures, plus some efforts to support and boost commercial construction eventually brought some relief to the sector. Despite socially-distanced working regimes, RMI and construction slowly began to recover, with modest growth figures recorded for Q3 and Q4 of 2020, and sustained into 2021.
New post-pandemic work landscapes
With the benefit of hindsight, the pandemic’s most significant legacy may prove to be the rethinking of working modes. As a matter of urgency, people were asked to stay at home and work remotely wherever possible. This soon caused workers to revaluate their work responsibilities and work-life balance. Supported by the development of more robust technologies, this new employment landscape has quickly acquired an air of permanence.
Already experiencing a modest decline from 2016 onwards, the office and business space sector is starting to look more vulnerable in the post-Covid era of flexible working as many businesses are forced to look more closely at their projected office-space requirements. Factoring in the news that Government ministers may give office workers a right to work at home would seem to reinforce this conclusion.
However, remote workers may soon discover online working has its own pitfalls. Online workers effectively opt to join a global employment market where they must compete with well-qualified candidates living abroad – who may cost a lot less to employ. In addition, it remains uncertain how insurance companies and the legal system will respond to the litigation issues sure to emerge once large volumes of commercial transactions are routinely conducted from domestic locations.
Outlook for recovery
Speculative constructors of commercial office accommodation are already experiencing this new reality – with vacant real estate or low-density occupancies failing to attract ever-cautious investors.
However, London performance figures for Q3 2020 onwards indicate starts have begun to increase, with a noticeable emphasis on major refurbishments. Probing this further, it seems clients are mostly seeking to reconfigure interior office space to install smart-building control and similar eco-friendly features. There has also been an understandable drive to create Covid-secure office space, primarily by redesigning ventilation and eliminating all cramped, confined areas. It is safe to assume observable London trends are being replicated in other parts of the UK, heralding a new demand for suspended ceilings with fresh, hygienic tile layouts, and the return of re-partitioning projects designed to create back-to-the-future open-plan offices.
In spite of the setback of recent reductions in demand, the prospects for medium-term growth in the UK suspended ceilings and partitions sector remain fairly secure, with projections suggesting growth over the next three years is set to reach around £335 million by 2025.