A net balance of -2% of survey respondents reporting a drop in Scotland’s construction workloads in the same quarter. 

Looking at the subsectors, infrastructure activity rose through the second quarter with a net balance of 27% of respondents reporting a rise, up from the net balance of 2% which was seen in the previous quarter. 

Public housing activity also rose through the second quarter, with a net balance of 13%, as did activity for “other public works” activity, which had a net balance of 5%. 

In the private industrial and private commercial sectors activity was reported to have fallen broadly flat, but private housebuilding activity saw a decline, with a net balance of -20%. 

Looking forward, a net balance of 10% of Scottish respondents anticipate workloads to rise over the next year. 

But pressure on profit margins remains. In Scotland, surveyors expect that profit margins will fall broadly flat over the next year, which is up from the net balance of -20% that was seen in the previous Q1 report.

In the survey, 60% of the respondents reported a shortage of quantity surveyors, up from 51% in the last survey. Additionally, 44% reported a shortage of bricklayers, up from 41% in the Q1 report and 47% report a shortage of other construction professionals, slightly increasing from the 46% reported earlier this year.  

Survey respondent Ian Differ of CBA QS Ltd in Glasgow said: “Construction inflation, material price volatility, and increased uncertainty due to the introduction of steel tariffs are the main challenges at present.”

Colin Brodie from The Rennie Partnership in Falkirk said there is a “lack of local authority investment.”

Discussing the UK picture, Simon Rubinsohn, RICS chief economist, said: “The latest results continue to demonstrate the ongoing challenges facing much of the construction industry.

“Rising material costs are exacerbating existing financial hurdles and being reflected in further pressure on profit margins. 

“Infrastructure continues to show a degree of resilience with workloads benefiting from a number of substantive projects.”

Rubinsohn added: “However, there is little evidence of any improvement in sentiment in the housebuilding sector highlighting the predicament the new prime minister faces in trying to reignite building activity and oversee a sharp uplift in the delivery of social housing.

“Aside from the headwinds provided by viability, respondents are continuing to point to regulatory barriers impeding the development timeline with problems around the building safety regulator still being frequently cited despite some improvements in the process.”