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Fees stagnant despite growing workloads

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The recovery in fee levels remains ‘somewhat elusive’ despite a growing market for architects’ services, according to the RIBA

Findings from the institute’s monthly Future Trends survey shows that optimism, particulalry in large and medium-sized practice, is high and that the amount of spare capacity within practices is now ‘rapidly reducing’. 

In December 2014, the percentage of those surveyed who had been ‘personally under-employed’ in the last month fell to just 9 per cent - a new all-time low for the survey which began in January 2009. 

A spokesman said that ‘given increasing workloads and reducing slack, the prospect for salaried architects going into 2015 appears better than it has been for a number of years’.

However the amount architects are charging for their work has yet to rise, even though there is ‘evidence of a real improvement in the economic outlook for the profession’.

RIBA Director of Practice Adrian Dobson said: ‘A recovery in fee levels seems to remain somewhat elusive for the profession, with many practices reporting they have not yet seen any significant uplift in fee levels and profit margins remain tight on many projects.’

Speaking about the state of the employment market Dobson added: ‘The challenge in this recovery is that as spare capacity within the profession reduces, we are beginning to see signs of practices encountering difficulties in attracting new staff with the right mix of skills and experience, particularly in areas such as Building Information Modelling (BIM).’

The RIBA findings come just days after the Office of National Statistics (ONS) showed the number of architects claiming jobseekers allowance fell to the lowest level since mid 2008 (see AJ 21.01.14).

The RIBA Future Trends data (December 2014):

  • The Workload Index was unchanged in December 2014, (remaining at +29), reflecting continuing confidence in the medium term outlook for the architectural services market. Workload forecast balance figures were positive in all nations and regions of the UK. The most positive figures were reported in Scotland (+75) and Northern Ireland (+50). 
  • In terms of practice size, small practices (1 – 10 staff) remain positive about the outlook for future workloads (with a balance figure of +22), but medium-sized practices (11 – 50 staff) and large-sized practices (51+ staff) continue to be more optimistic about workload prospects in the next quarter.
  • In terms of different sectors, the private housing sector workload forecast fell back marginally to +25 in December 2014, down from +26 in November 2014. Yet, the private housing sector continues to be the most robust, supported by continuing historically low interest rates and the on-going Government Help to Buy schemes to assist home lending.
  • The commercial sector workload forecast lost some momentum, falling back to +17 in December 2014 from +20 in November 2014.  By contrast the public sector workload forecast (+7) and the community sector workload forecast (+6) both improved.
  • The Staffing Index increased to +17 in December 2014, up from +11 in November 2014, with just 1 per cent of practices predicting a decrease in overall permanent staffing levels over the next quarter. 
  • Medium-sized practices (11 – 50 staff), with a balance figure of +47, and large practices (51+ staff), with a balance figure of +67, continue to be more confident about their ability to sustain higher staffing levels in the medium term than small practices (1 – 10 staff), with a balance figure of +11.

 

 

 

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