Civil Engineering Reference
In-Depth Information
industry as several different markets, each with distinct factors that affect supply
and demand.
The total supply of construction output in Great Britain is broken down into
specific activities according to monetary value in
Table 5.2
. House builders supply
approximately 17 per cent of the annual output. Contractors supplying industrial
and commercial buildings account for 24 per cent of the total output in value terms.
The large building and civil engineering firms undertaking complex infrastructure
projects such as motorways, power stations, airports and other public sector activity
relating to education, health and the police account for a further 24 per cent of
the industry's supply. This leaves the large number of small general builders dealing
with repair and maintenance contracts to supply the largest share of the activity with
36 per cent.
Table 5.2
Construction industry supply in Great Britain, 2010
(at current prices)
Value (£million)
Type of work
Percentage of total
New public housing
New private housing
Total
Private industrial
Private commercial
Total
4,770
14,281
19,051
3,573
23,312
26,885
12,660
16.6
23.5
Infrastructure
Public (non residential)
14,204
Total
Total repair and maintenance
26,864
23.5
41,630
36.4
100.0
Grand total
114,430
Source:
Construction Statistics Annual (ONS 2011a: Table 2.1).
It should be pointed out that the labour, capital and management resources
employed on any one construction project could transfer to another. In fact, it is
quite common for a specialist trade firm to move from site to site as contracts are
fulfilled, and few firms remain in place for the whole duration of a project. It is
this overlapping nature of the sectors comprising construction that gives rise to some
common reference points for factor rewards across the industry. In other words,
rates of profit, wages and material prices tend towards some kind of equilibrium.
Indeed, as competition intensifies or diminishes in particular sectors across the
industry, suppliers could decide to shift the use of their resources to gain higher
rewards. This will become clearer as we discuss in subsequent chapters patterns of
cost and contracting characterised by differing levels of competition.
