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How Inflation Impact the Design Market

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Early 2022 appeared to be the end of the pandemic. After two years of lockdown and economic crisis, businesses had hope for recovery. However, the conflict in Ukraine and predicted inflation caused further disruption for UK businesses.

How does inflation impact the design and architecture? Especially those serving the residential and hospitality industries. Details shared below are accessed based on data collected from RIBA trend forecastGov Census and Trading Economics

The Impact: 

According to national statistics, the inflation rate rose to 10.8% in July 2022. It affected design goods and building supplies due rise in raw materials. Fuel costs and energy bills also concerned supply demand, stock supplies and scaling down on overhead capacity in offices, encouraging the alternative hybrid work.

Affect on Supply Chains

Design goods and building supplies are low in stock by the supply chains, meaning it could take up to 10 weeks for delivery. For this reason, local suppliers and manufacturers face high demand. Businesses that serve projects with a small budget cannot fulfil innovation and opt for less popular design options. The luxury market suppliers can pass down the costs to buyers who can afford to spend.

A Rise in Energy Bills

A rise in energy bills has also caused businesses to go hybrid or be forced to close down with the additional costs faced. A situation especially faced by SME specialist studios.

Hospitality Market 

Restaurants and hotels struggle with high wages and low overheads. As the cost of living increases, employees seek higher-paid roles, leaving businesses scrambling to meet demands.

Pubs are also severely impacted by peak energy bills. An owner states the rise in energy bills means a pint could cost their customer £20.

Private Residential Market

On the contrary, the private residential market grew until July 2022 due to inflation. The housing marketing also adapted to the current economic climate moving towards a sustainable approach, including energy-efficient design options, insulation and off-grid energy solution.


 What’s your business journey during inflation? Experienced something different? Share your story in the comments below.