23858634_sUK: Business is continuing to improve for the building services sector, according to the latest state of trade research.

The survey, carried out amongst members of the Building & Engineering Services Association (B&ES), reveals increased order books and enquiries for the first half of this year and growing confidence in future prospects. Over half of respondents reported feeling positive about future prospects, resulting in the “net optimism measure” rising from +35% to +49% compared with six months ago.

A stabilisation in tender prices suggests improved trading conditions, a situation confirmed by an increase in labour costs as skills shortages begin to bite once again. Rises in materials costs, however, were less evident than at the start of the year.

In fact, 58% of respondents reported an increase in their order books – twice as many as last time – and almost half had experienced higher enquiry levels.

Geographically, more companies in East Anglia, East Midlands and the South West of England reported improvement in business levels than in other regions, with only firms in Northern Ireland recording a decline in enquiries and recruitment, along with static order books and turnover levels.

In terms of market sectors, firms active in service and facilities and industrial/ commercial installation were able to see the biggest improvement, although business also grew in the domestic sector, where a decline in both order books and enquiries was picked up by the previous survey.

The employment situation is improving, with 38% of respondents confirming that they were employing more people than six months ago, while 44% expected to recruit during the second half of 2014. The use of agency labour has also risen significantly – as has the number of firms hiring apprentices or trainees, which showed an increase of more than a fifth.

Chief executive Rod Pettigrew pointed out that this was the third successive B&ES survey to have painted a brightening picture for building engineering services – and, by implication, for the construction industry as a whole.