Construction industry shows recovery signs
Bermuda’s construction and real estate industries are showing tentative signs of recovery, according to leaders in the field.
However, Charles Dunstan, the head of the Construction Association of Bermuda, echoed concerns that the Island needs more up-to-date information as it gets to grips with its unemployment problem.
Figures released last week showed 800 jobs were lost in Bermuda as a whole in 2014. Giving a progress report on the construction industry, Mr Dunstan told The Royal Gazette his confidence was now starting to lift after a “dire” start to this year.
“I’m not quite sure why, other than that maybe people are fed up and they’re deciding to do some work prior to things taking off — they’re getting little renovation jobs done,” Mr Dunstan said.
“Construction material sales over the past six months indicate a little bit of an uptick. Most contractors I talk to who have come through the recession are doing fairly well; they seem to be quite busy.
“It’s like the stock market — it’s all based on confidence.”
Independent Senator James Jardine has complained that last week’s unemployment information from the Department of Statistics was so late it was “absolutely useless”; it was derived from surveys conducted in August last year.
On that point, Mr Dunstan said: “It’s a problem. It’s based upon often year-old data that may have no relevance to today’s picture.
“The best guess is there are probably around 2,000 people working in construction, down from about 3,500 some five years ago. It may be a little bit lower, maybe 1,800.”
Meanwhile, Buddy Rego of Rego Sotheby’s International said some buoyancy has crept into the real estate sector. “It bottomed out two years ago, and it’s been on the increase year over year,” he said. “2012 was the absolute rock bottom.
“There has been a turnaround — I don’t mean the business of individual companies; I’m talking about the entire market.
“It could well be that some real estate companies are still complaining doom and gloom because they aren’t selling anything, but in the industry year over year there has been about a 10 per cent increase.
“That’s a positive sign.
“We’re not anywhere near the $700 million market that we had eight years ago, but there’s more of a turnover.”
The unemployment rate for 2014 was 9 per cent, up from 7 per cent a year earlier.
Anchor Investment Management estimates that the rate of Bermudians out of work sprang from 4.5 per cent in 2008 to 11.3 per cent in 2014. Non-Bermudians accounted for 52 per cent of the 6,738 total jobs lost in that time.
Nathan Kowalski, chief financial officer at Anchor, said: “Employment of Bermudians actually peaked in 2004 and stayed relatively flat until 2008, before declining with the weakening of the local economy.
“As for more recent 2015 data, we do not have many indicators to point to as the quarterly bulletin of statistics was only recently released or the fourth quarter of 2014.
“Outside of CPI and retail sales, virtually no data has been given for 2015.”
He said leading indicators for retail sales and freight suggested that some areas of the economy were improving — and as a result, “some job growth could be present”.
However, he warned that consolidation within the reinsurance market “may temper this positive bias”.
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