Sunday, 30 September 2012

Doom and gloom or a new way of working?

Things can't be good if you can encapsulate the state of the construction industry in a tweet, as Simon Rawlinson of EC Harris did a few days ago. He wrote: 'Workload has fallen in real terms in 5 of the past 8 quarters. Value of work awarded over last 12 months back to pre-1980s boom levels.' There is no way you can spin that to be positive.
Yet it is notable when talking to architects that many of them are desperately busy - often too busy to talk. For some this means that they have found their niche or have a fantastic reputation and are bucking the trend. For others it is a rather febrile busyness - a lot of pitching for work, doing the same jobs for less money, or replacing bigger jobs with smaller ones. Staff numbers may have shrunk, and they are trying to keep the output going with fewer people. One architect I visited recently started giving the team free lunch in the office to make up for cutting wages (although they had subsequently reinstated the wages - and kept the free lunch!).
The struggle to survive is not always successful. One of the latest failures, as reported in the AJ (sorry, subscription barrier) this week, was Manchester based MBLA, a multiple award winner with a 24-year track record, so scarcely naive or inexperienced or untalented. It was sunk, apparently, by a bad debt.
Yet the magazine also reports every week on the establishment of new practices, of which there seems to be an inexhaustible supply. Some of these may be 'virtual' practices, with no offices and the principals also doing  other things to make ends meet. Anybody setting up a full-on practice is creating a hungry animal that needs constant feeding. Even a small office and a couple of staff rack up the costs, and there is inevitably a gap between establishment and receiving fees.
I was talking to somebody this week who has been analysing some of the larger practices' figures and reckons that many of the 'successes', the ones we would never doubt, have worrying levels of debt.
Young architects are willing to duck and dive; an increasing number of the more experienced are becoming independent consultants, lending their expertise to projects with no risk. But what about those who should be mid-career, growing an office, or progressing through one? These are difficult times.