SA civil construction under pressure

The local civil construction industry in South Africa is in for a tough year despite anecdotal evidence that the current downward cycle has bottomed, according to the South African Federation of Civil Engineering Contractors (Safcec).

However, the newly established Presidential Infrastructure Coordinating Commission could potentially counter this as it attempts to deal with what is recognised by the state as a lack of coordination and integrated planning surrounding key infrastructure projects. 

“A decline will, however, definitely be the case if national departments and provincial and local governments continue to hand back unspent capital budgets to treasury,” said Neville Gurry, Executive Director at Safcec. 

“If any recovery happens, it will be very modest. We are hoping for a more positive recovery, but, at best, this will be a single-digit rate over 2011. We hope for a marginal improvement in turnovers in 2012 and, if so, it will not exceed 5 percent to 7 per cent.”

Currently, employment in the industry has already contracted by 39 per cent to 106,330 people in the third quarter of 2011, and turnover in the industry has declined from R58 billion in 2008, to R32 billion in 2010.