THE First National Bank civil construction confidence index jumped from 70 in the third quarter to 83 in the fourth quarter of last year, with greater availability of new work boosting confidence levels.

The index, compiled by the Bureau of Economic Research, recovered notably during the fourth quarter of last year after the relatively sharp drop experienced during the third quarter.

According to the index the growth in civil construction activity during the fourth quarter turned out slightly better than expected.

The higher work volumes executed were accompanied by an improvement in profit margins, hence the overall profitability growth of the businesses that participated in the survey.

Tendering competition dropped sharply during the fourth quarter. A drop in tendering competition is normally associated with the greater availability of new work.

The growth in employment expanded relatively sharply, but respondents to the survey indicated that they battled to procure adequate labour resources.

In fact, 98% of the companies polled indicated they were experiencing skilled labour shortages and this constrained their operational efficiency.

The SA Federation of Civil Engineering Contractors reported a further rise in civil construction employment in the third quarter of last year to 121600. This compares with 108300 a year earlier, an increase of 12%.

Indications are that business conditions will remain positive and lively in the first quarter of this year.