The IWFM market outlook for 2019 shows 'mixed views' on industry, reports Herpreet Kaur Grewal.
05 August 2019 | Herpreet Kaur Grewal
Respondents to the Institute for Workplace and Facilities Management's Market Outlook report had "markedly mixed views" on the performance of the UK FM market over the past 12 months.
Around a third of those asked believe that the market had improved, another third saw no change and a third reported that it had worsened.
Among the reasons offered for why the market had worsened, the most frequently cited was the collapse of Carillion and the financial difficulties experienced by Interserve, which was seen to have undermined confidence in the FM market.
Predictions for the FM market over the next 12 months were a little more optimistic, with a slightly higher proportion of respondents anticipating either an improvement or no change.
Among the reasons provided for why the market might worsen over the next 12 months, the most frequently cited was Brexit, which was seen to be creating uncertainty and causing people to delay business decisions.
Other negative factors were a lack of skilled workers and the state of the UK economy. Most respondents anticipated these factors would persist over the next 12 months.
Three-quarters of respondents indicated that recruiting people with the right skills had been difficult (or very difficult) over the past 12 months, and that these difficulties would continue over the next 12 months.
People's experiences of their own organisations' performance over the last 12 months were generally more positive than for the FM market overall, with more than half of responses reporting an increase in employment and turnover.
In terms of the forces that are affecting FM at an organisational level and the FM market overall, changes in technology were overwhelmingly perceived to be having a positive impact.
The positive impact of technological change on FM was predicted to continue over the next 12 months, suggesting that most of the respondents to the survey see new technologies as an opportunity rather than a threat.
This report is based on online survey responses of 251 IWFM members in April 2019. The responses came from a broad cross-section of people, including senior managers and decision-makers, and representatives from client organisations and FM service providers.
Most responses were from people in larger organisations, with small and medium-sized enterprises (SMEs) being underrepresented in the sample, relative to the role they play in the FM market and UK economy overall.
However, collectively respondents worked across all industry sectors and UK regions, which suggests that their responses represent a wide diversity
In conclusion, the authors said the UK FM market's vulnerability to the outside influences of Brexit and a lack of skilled workers "is arguably exacerbated by its reliance on a cost-focused, low-margin, commoditised business model".
It added that this model provides "little protection against outside 'shocks' such as Brexit or changes in government policy. However, that's not to say that the constituents of the UK FM are passive in the face of these outside forces; it's clear from our survey that some organisations are actively responding to a changing political and economic environment, for instance by specialising, innovating or moving away from contracts awarded purely on cost".
The full report is available at tinyurl.com/FacMag0819-MarketOutlook