New research has revealed almost one in three (28%) engineering services firms reported a fall in turnover during the first three months of this year.

A survey run in partnership by trade bodies including the Electrical Contractors Association (ECA) and the Building Engineering Services Association (BESA) found that out of 316 respondents, companies cited ongoing issues that impacted growth such as;

• Poor payment practices (60% of commercial work was paid later than 30 days after completion)

• One-off events, such as unusually adverse weather conditions (34%) said this had impacted productivity)

Overall, the figure is the highest reported percentage fall in turnover since Q1 2016, when 33% of respondents reported a fall in turnover since the previous quarter.

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However, most firms are upbeat about their future outlook in the current quarter, with 86% of businesses said they expect turnover to increase or remain the same.

ECA Deputy Director of Business Policy and Practice, Rob Driscoll, said: "So far, 2018 has been characterised by continual uncertainty as we awaited the output from the Grenfell enquiry, continued in the shadow of Brexit, saw Carillion fall and powered through a prolonged period of extreme weather.

"It was therefore no surprise that the first quarter of 2018 showed some decline, but despite higher operational costs and ongoing issues surrounding protracted payment, our sector has historically proven its resilience and has a positive outlook as demand is expected to increase during the second quarter."

BESA Head of Legal, Debbie Petford, said: "The construction industry is facing very tough times, with greater demands to complete projects faster, cheaper and to higher standards. There were some significant blows to the industry this year, with Carillion, the ‘Beast from the East’ and the impact of Grenfell Tower still being felt; but the industry will continue to work hard, grow and deliver."

(LM)