Home News FM sector remains buoyant despite continuing uncertainty in business environment

FM sector remains buoyant despite continuing uncertainty in business environment

by Brian Sims

The outlook of the UK’s facilities management (FM) sector remains positive overall, but it’s more cautious in its approach due to external factors affecting the business environment. That’s the headline outcome of the FM Business Confidence Monitor 2016 research conducted by the BIFM in partnership with i-FM.net and Barclays.

The FM Business Confidence Monitor is created by way of a survey of professionals from the FM sector within the UK. It shows that 64% of practitioners interviewed describe the FM business environment as ‘positive’ or ‘very positive’ at the present time. When compared to the findings from 2015, this represents a 6% reduction.

However, on digesting all responses and interviews from key representatives of the industry, the major factors behind this are caused by external influences such as the upcoming EU Referendum, the economy and changes to Government funding.

With the FM sector employing approximately 10% of the UK’s working population and estimated to be worth £111 billion a year to our economy, it’s very much seen as a barometer of business performance as a whole.

When considering their own business, 38% of respondents say they’re confident just now, while 30% indicate that they’re slightly more confident in terms of the economic growth and performance of their company over the next 12 months when compared with last year.

The respondents’ views on apprenticeships stand out within the findings. When asked if the Apprenticeship Levy will facilitate more apprentices within their organisation, 48% of respondents remain unsure. When quizzed as to whether they plan to hire apprentices in 2016, only 35% answered ‘Yes’ compared to 47% in 2015.

While the Government and FM service providers alike speak passionately about the importance of funding these programmes, the research appears to suggest there’s a disconnect between rhetoric and ambition and the practicalities of delivery.

Proceeding with caution

The survey captures a picture of FM market confidence by canvassing the views of the sector’s senior decision-makers as well as the teams on the ground delivering those services throughout the UK. The outcome of this work aims to provide an authoritative forecast of overall business confidence for the next 12 months.

James Sutton, CEO of the BIFM, said: “The outlook of the FM industry remains relatively buoyant, although it appears to be proceeding with caution until the outcome of the EU Referendum and the effects of new legislation such as the Apprenticeship Levy are fully realised.”

Sutton continued: “Although the future funding of apprenticeships has been protected by the Government, the findings of this year’s FM Business Confidence Monitor also echo the Institute’s discussions with employers. This is that there does seem to be a limited understanding of apprenticeships and the full extent of the opportunities and implications they present.”

He added: “When used correctly, apprenticeships have the ability to benefit people, organisations and the workforce and, therefore, society as a whole. As an Institute, we will be doing more to help support this agenda over the coming months as part of our commitment to raise professional standards in FM. We’ll continue to work with Government, key stakeholders and employers such that we can embrace the opportunities the Apprenticeship Levy offers.”

Simon Iatrou, the Editor of i-FM.net, explained: “By canvassing the opinions of businesses and professionals in the sector, we not only derive an accurate picture of the current FM business environment, but also a projection of how wider UK industry may fare in 2016. While the FM industry remains largely optimistic, this year’s report reveals an undeniable ebb in confidence. Factors both new and familiar to FM professionals, from plummeting oil prices to training staff, are responsible for this shift. Many of these challenges, however, are not unique to FM.”

Terry Myatt, relationship director for business services at Barclays, stated: “The cautious optimism displayed by the FM sector in this year’s survey results is understandable given the range of uncertainties facing the industry in the short term. However, there are still growth opportunities ahead for those businesses with a clear strategy, and who are able to adapt at speed to the changing economic and regulatory environment.”

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