43% of mid-market construction firms feel a ‘no deal’ Brexit will boost revenues

Published:  15 October, 2018

More than 40% of middle market firms operating within the construction sector believe that exiting the European Union without a Brexit deal will have an advantageous or favourable effect on their revenues, according to a new survey by RSM.

Of the 43%, 4% feel it would be advantageous and 39% feel it would be favourable.

A further 25% of the construction firms that took part in the survey view exiting the EU, having failed to negotiate a deal, will have no effect on their future turnover. Just 21% feel it will harm revenues. Seven per cent believe it would have a catastrophic effect.

This compared to 45% of leaders in financial services and 40% in TMT seeing the most potential to benefit from a ‘no deal’ scenario. Conversely the consumer sector (35%) see it as the most harmful.

Kelly Boorman, partner and national head of construction at audit, tax and consulting firm RSM, said: "Mid-market construction firms continue to show optimism about their future prospects, despite continuing market uncertainty. It is perhaps surprising how bullish they are when it comes to the effects of a ‘no deal’ Brexit. One of the reasons for this could be down to the fact that there continues to be investment in the sector, demand for housing and focus on new innovation to generate both efficiencies and growth. This coupled with the weak pound continuing to attract overseas investment provides opportunity for growth."

The quarterly Brexit Monitor, conducted by YouGov prior to the EU leaders meeting in Salzburg on 19/20 September 2018, surveyed 325 mid-market business leaders, 55 of which operate in the construction sector.

The survey also found that the sector’s confidence in the government's ability to achieve a 'good deal' has dropped by a sizeable 22 percentage points. At 46%, confidence was down from 68% the previous quarter (Q2), now on a level-pegging with manufacturing. Optimism for a good deal within the sector now sits at the lowest level since the survey began in the second quarter of 2017.

Despite the drop, both the construction and manufacturing sectors still maintain the most confidence in a ‘good deal’ out of all the industries surveyed.

Boorman added: "All eyes will now be on this week’s EU summit, described by Donald Tusk as 'the moment of truth'. Many businesses will be hoping for some much-needed progress from both the EU and the UK."

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