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Backward Linkages from Construction

Author

Listed:
  • Kenneth Gibb

    (Centre for Housing Research and Urban studies, University of Glasgow)

  • Margaret Keoghan

    (Centre for Housing Research and Urban studies, University of Glasgow)

Abstract

One argument for increasing construction investment is the number of jobs and related multipliers associated with property investment. However, economic activity does not begin and end with actual construction: there are important backward linkages into the input markets for construction. If these markets can be shown to be primarily indigenous or at least with the potential to be locally-based, then there are wider local and regional benefits that may accrue from construction programmes. This paper is based on recent Scottish research which traced back the linkages from construction to specific building supplies markets in materials, semi-finished and finished products. Strong economy-wide multiplier effects are identified for construction output, for those on low incomes and in terms of job creation. Scottish construction is found to be primarily self-contained with consequent opportunities to maxi-mise the local economic impact of construction work. The research suggests that policies need to target specific supply industries, meet the skills shortage challenge and confront the problems associated with construction tendering.

Suggested Citation

  • Kenneth Gibb & Margaret Keoghan, 1998. "Backward Linkages from Construction," Local Economy, London South Bank University, vol. 13(3), pages 198-215, November.
    • Handle: RePEc:sae:loceco:v:13:y:1998:i:3:p:198-215
    DOI: 10.1080/02690949808726444
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