A recession is where there is temporary economic deterioration which lasts longer than a few months, sometimes years. This can be seen by the employment rate decreasing and the reduction of trade and industry work. This is determined by the Gross Domestic Product (GPD) which is a government statistic which shows the total country’s economy movement. This is measured every 3 months (quarterly) and it is said that if after two consecutive quarters the GPD is down then the country is seen to be in recession. (Kollewe, 2009). The most recent recession in the UK kick-started in 2008, which was seen to be one of the worst recessions the UK has seen since the Great Depression. In July 2008 was when it became increasingly obvious that we was about to enter a recession; the unemployment rate kept rising, the housing industry started to cut thousands of jobs and the whole-sale industry was declining in production. (Allen, 2010) When we see an economic downturn many of the different industries are affected in different ways depending upon their demand. The industry which always seems to be affected first and the last to recover is the construction industry. The construction industry is one of the largest sectors of the UK’s economy. It contributes around £90billion which is 6.7% of the total and 2.9 million people are employed within the construction sector. (HM Government, 2013) (Barawas and Fleetwood et al., 2013) This contribution is measured by the Gross Value Added (GVA), here below is a table to represent the contribution the construction industries GVA (for 2012 prices) and its % of economy. (Rhodes, 2013, pp. 3) From the table above you can see that it was in 2007 which was highest peak the construction industry in the last 10years, contributing £102.5 billion (7.1% of the economy) however in 2012 the contribution was £19.5 billion less than at this peak. In this next graph you can see the how the construction industry fell deeper into the recession than the whole economy and how there was a rise in 2009 however how the construction industry is still struggling to get out of the recession with a further dip in 2013. (Rhodes, 2013, pp. 5) Demand plays a huge part on the construction industry before and whilst recovering from the recession. Demand is the willingness and ability of buyers to purchase different quantities of a good at different prices during a specific period of time.
Since the 1960s, there has been a large shift from the other two industry sectors to the Tertiary Sector in the UK. The other two industry sectors Primary and secondary sectors have either moved abroad where it is cheaper for goods to be manufactured or completely shut down because of consumer trends.
By definition, an economic depression is a “sustained, long-term downturn in economic activity in one or more economies.” (http://en.wikipedia.org/wiki/Economic_depression) The latter, is far worse then a recession. A recession is merely an economic slowdown, which was experienced by most Atlantic Provinces in the late 19th century.
As the nation was introduced into the current recession, the auto industry and its labor was likely hurt more than any other industry. Few years ago it was the homebuilding industry that was troubled the most and held the first place, but it gave that position over to the auto industry the following year. Why was this industry affected more than any other is very interesting and complex situation. There are several factors why there was such a huge negative impact on this industry, its performance, and the labor involved. Some of the major reasons are very high foreign competition, higher oil prices, and certainly the recession.
Looking back to the Carter and Reagan Administration’s, you can begin to see where the Recession originated from. Prior to the Reagan administration, the United States economy experienced a decade of rising unemployment and inflation. Political pressure favored stimulus resulting in an expansion of the money supply. Reagan wanted to increase defense spending while lowering taxes, Reagan's approach was a departure from his immediate predecessors. Reagan enacted lower marginal tax rates in combination with simplified income tax codes and continued deregulation. During Reagan's presidency the annual deficits averaged 4.2% of GDP after inheriting an annual deficit of 2.7% of GDP in 1980 under President Carter. The real
Economic- The home improvement industry is below their normal state with the present economic status. Consumers are putting their wants such as adding new appliances or redoing their bathroom on hold. Construction companies are also in a slump; with the building of new homes on a downward slope the large orders of construction companies are not being made
PESTEL analysis factors apply to Bryant homes as follows; Political: the UK government policy directives, planning and environmental issues including sustainability affect the construction industry quite a lot. In the economical sector the economy’s health and interest rates affect demand for the commercial and the residential property, furthermore the taxation in the UK is used as a mean to encourage improving environmental performance; In addition to all this we can also add that as an economical factor the amounts of money that are needed for advertising the company’s products and services this action helps the company’s clients to understand how the company works. Also the construction industry in the UK is increasingly interested in whole life costs of the building, which includes initial capital costs and operating/maintenance costs. As far as the social factor goes changes in the birth divorce rates and the average number of people living in a household affect the demand of housing. Also we can take into consideration that there was a perception that the company’s builders had a tendency to dictate what the customers needed and had rat...
middle of paper ... ... It is evident that although we may be entering into a recession on different terms than the one before, the United States is still in danger of once again becoming a victim of another Great Depression. The Great Depression is a time in the history of the United States that people have learned and gained knowledge from. Its harsh times and conflicts have been written about in books, seen in movies, talked about on radios, and told to families throughout the generations.
In the British construction industry, the term ‘procurement’ show a series of activities and processes undertaken by the developer or client to secure the construction or refurbishment of a building. The Government Procurement Service define procurement as the ‘whole process of acquisition from the third parties and covers goods, services and construction projects. This process spans the whole life cycle from initial concept and definition of business needs through to the end of the useful life of an asset or end of a service contract.’ ( Arun District Council, 2011)
According to The Balance, a financial website brand owned by About.com, the causes of the 2008 recession have been blamed on certain factors such as the decline of manufacturing orders that began in 2006, and the housing market crash in 2007 which created a domino effect that lead to recession. According to Investopedia, in the short time before the 2008 recession, stocks were at an all time high in October of 2007. Less than a year later in September of 2008, stocks were down over 20%. This is eerily similar to today’s massive growth in the economy which could eventually fall like 2008’s. One of the largest indicators of where the economy is heading stems from the current politics of the United States. Economic plans of the Trump Administration such as an investment in infrastructure, promises to lower taxes, and bringing jobs and production back to America, have arguably been some of the reasons for such a large amount of speculative growth in the economy. Unless Washington does in fact follow through on their end of the bargain, the growth that our economy is seeing today can turn in the opposite direction in the blink of an eye. Some signs of a future recession of the economy have come just recently from the unexpected unemployment increase. According to CNBC, in March of 2017, 98,000 jobs were created although it was estimated that 180,000 were
Strengths of the Construction industry include staying power for the industry, yet not as much so with individual companies. Government contracts are a big attractor to the industry and offer well compensated opportunities, as well as the fact that one is creating something from scratch that is designed to be a dwelling.
To succeed against the competition, the UK construction industry must deliver quality products and services at acceptable costs as a matter of course. But increasingly its stakeholders all those it does business with or who are affected by its operations expect more from the industry in terms of how it operates and its overall impact on society.
Construction industry is one of important sector for any country which contributes a lot its economical and global growth. India is not far behind in this sector. Indian construction industry is growing at a rapid rate and contributing to improve its domestic as well as global economy. An estimate amount of Rs. 6708 billion is the contribution of construction industry in Indian GDP (2011-2012). Not only it provides jobs to the people of the country but it also creates investment opportunities for many sectors.
As we realize that Construction is the way toward developing a building or framework. Construction is a general term meaning the art and science to form objects, systems, or organizations and comes from Latin constructionem (from com- "together" and struere "to pile up") and Old French construction. Construction differs from manufacturing in that manufacturing typically involves mass production of similar items without designated purchaser, while construction typically takes place on location for a known client. Construction as an industry compromises of 6 % to 9 % of the gross domestic product (GDP) of developed countries. Construction begins with planning, design, and financing; and continues until the project is built and ready for use. The Construction Industry is a vital marker of the
Owner, renter and user are on demand side of the market, that is they are consumers. Developers, financiers and renovators are suppliers (Acton et al. 1999). Unlike commodities, market demand and supply forces do not float easily. This is because of the uniqueness of this market. Real market industry has these unique characteristics, durability of products as buildings can last for decades or centuries.
In India, Construction Industry plays a vital key role in both economic growth and poverty reduction. The industry consumes about 45 to 55% of the national five year plan outlay and contributes to nearly 30% of GDP. A construction industry is the second largest industry next only to agriculture in terms of providing employment in India. Indian Government is targeting an economic growth of around eight per cent during the Eleventh five year Plan (2008-12). Construction projects entire high risk, long construction span, high costs and budget changes. India it is the second most populous country in the world with over one billion people accounting for around 19% of the world’s population. It is estimated that the population living