With shortages in supplies of almost everything from skilled labour to serviced lands creating problems for the construction industry, a number of issues need to be urgently tackled, according to industry experts.

After a record year in 1999 when the overall volume of construction grew by 12.5 per cent, industry spokesmen say that the "cracks" now emerging will make it difficult for the industry to maintain that growth pattern. Total turnover for new building has grown from £2,424 million in 1993 to £8,856 million in 1999 and, according to chartered quantity surveyors Patterson Kempster and Shortall, the industry met this demanding pace with only marginal strains. Increases in productivity, soaking up slack in the labour force, returning emigrants, and firms entering the market from Northern Ireland and Britain, have "helped to provide the resources to meet the ever-increasing needs of the industry," says PKS.

However, the industry is going to have to "rethink" its approach to growing demand, it says.

The company has warned that a combination of shortages in skilled labour, inadequate supply of apprentices and labour unrest on sites have begun to lengthen construction periods and contribute to increases in contract prices.

However, Ciaran Ryan, director of the Irish Home Builders Association, says the lack of serviced lands is the most serious element in the series of bottlenecks.

"If you take it from the housing point of view, our supply has increased from just over 19,000 units in 1993 to over 43,000 units in 1999," says Mr Ryan.

"We believe, as private house builders, we have the capacity to well exceed 50,000 homes each year." The bottleneck is not in the capacity of the industry, it is in the capacity of the planning system and infrastructure, he says.

The Department of the Environment is predicting 10 per cent volume growth this year and again in 2001. Goodbody Stockbrokers has forecast an average growth of 6.3 per cent each year until 2003, while the Economic and Social Research Institute has estimated volume growth of 2.9 per cent per annum from 2000 to 2010.

Over the next seven years, spending will double in almost every area of construction; social and economic infrastructural projects will increase from the current level of £1,900 million to £3,000 million a year;

The annual average spend on social housing will more than double from the existing average of £400 million a year (between 1994 and 1999) to £857 million annually. Money allocated to roads will double from the current annual average of £400 million to £800 million a year for the next seven years.

Since a large number of returning workers has already been absorbed, industry will now have to grasp the nettle of employing foreign labour, says PKS.

A spokesman for the Department for Enterprise and Employment said that approximately 6,000 work permits were issued for the service industry as a whole, out of which the majority were allocated for the computer and building industries.

Work permits are issued for up to one year and cost the employer, who applies for the permit, up to £125.

On the basis of the National Development Plan and taxation changes in Ireland, Goodbody stockbrokers says over 150,000 foreign workers will be needed over the course of the next seven years.

The Construction Industry Federation says it hopes to increase numbers from the existing labour base here and that attracting foreign workers is clearly one of the options

First year apprenticeship numbers have virtually trebled from over 2,000 in 1994 to over 6,000 currently.

The industry has already drawn workers from Britain in the last few years. However, says Liam Kelleher, director-general of the CIF, this will not be as easy in future. He sees improvements in productivity as one way of addressing the increased demand over the coming years.

FAS says building has more jobs coming on board than there are applicants. It AS has run recruitment awareness campaigns at trade fairs on a regular basis in EU capitals and is currently considering visiting places where there is a large expatriate population, such as the United States.

Notwithstanding the need for extra serviced lands for the private house market, PKS feel that these trends will need to be accelerated and blockages removed if the industry is to grow and meet the challenges it is facing over the coming years.