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UK big guns dig in for downturn

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NEWS

Two of the UK's biggest architectural practices are tightening their belts amid fears that the terrorist atrocities in the US will spark a severe downturn in the building industry.

Last week Aukett Europe (fifth in the AJ's top 100 practice survey, 22.3.01) laid off 17 staff from its London offices. Gensler, which came seventh in the same survey, is also gearing up for cuts.

In a short statement Aukett said the redundancies followed 'the uncertainty in the UK economy and the unpredictability of future market conditions following the tragic events in the US on 11 September'. The statement went on to say that the company had experienced 'a slowdown' in the commercial sector and IT-related projects.

The move follows redundancies earlier this year amid the revelation that the 400-strong Aukett group - one of just two UK architectural practices to be listed on the Stock Exchange - saw its half-yearly profits fall by more than 50 per cent compared with the previous year (AJ 07.06.01).

Capita is also listed, but director Andrew Murray said there were 'no changes' in orders.

City-based practice Gensler admitted that it could also cut staff numbers following a 'downturn in business'. But it said it would try to achieve cuts through 'voluntary means' where possible.

Despite the tough decisions facing Aukett and Gensler, and rumours of pay cuts and redundancies in other large practices, most in the profession remain sanguine. Many observers agree that, while there is cause for concern, the events of 11 September are not the major cause.

Other City practices are weathering the storm.

Chief executive of TTSP Mike Carter said that while his company was 'keeping a close eye' on the economic situation, he would not be making any cuts in the immediate term. While some of his clients - 70 per cent of which are City-based - were showing signs of nervousness, none had pulled out as a consequence of the attacks. 'We will be conducting a wait and see policy, ' he said.

Rab Bennetts, director of Bennetts Associates, agreed that while many architectural practices were nervous about a slowdown, most were 'keeping a cool head'. None of his projects had yet been cancelled and there would be no redundancies 'for a few months, if at all'. But he warned: 'There is a danger of talking ourselves into recession.'

While it is too early to assess fully the impact of the slowdown generally - and the terrorist attacks in particular - some signs indicate the profession remains buoyant. Director of Adrem recruitment agency Steve Rimmer reports that the number of monthly vacancies registered with his company has been up year on year. In August, his company registered a 40 per cent increase on the previous year. 'It's interesting that against a backdrop of cautiousness, business is holding up, ' he said.

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