As economic pressures mount, small building companies face declining workloads and rising costs.
- The FMB survey highlights a significant drop in workloads for a substantial number of small builders.
- Hiring skilled workers remains a persistent challenge for these firms, impacting project timelines.
- Material costs continue to rise, adding to the financial strain on construction companies.
- Despite previous signs of recovery, the outlook for the building industry remains bleak.
The latest survey from the Federation of Master Builders (FMB) presents a concerning picture for small building firms, as workload reductions plague the industry. With only 27% of these businesses reporting increased activity between the second and third quarters of the year, a notable 32% have experienced a downturn.
Finding skilled workers remains a significant issue, with firms struggling to hire essential tradespeople. The survey indicates a decline in the availability of bricklayers and carpenters, exacerbating delays. Notably, 38% of FMB members reported that the scarcity of skilled labour resulted in project postponements, reflecting the broader challenges in maintaining operational momentum.
Material costs have risen, further straining the finances of construction firms. Approximately 65% of FMB members cited that these increased expenses are being passed onto clients through higher service charges. This slight decline from 67% in the previous quarter does little to ease the pressure on builders, who are navigating a volatile economic environment.
Brian Berry, the Chief Executive of FMB, articulates the challenges faced by the industry: “The economic climate for small building companies is tough, with workloads and employment figures falling.” He stresses the ongoing nature of these issues, likening them to the post-2008 financial crisis period.
Berry further criticises the government’s lack of action in the recent budget, pointing out the missed opportunity to address the skills shortage. There’s a pressing need for prioritising the development of construction skills to meet ambitious housebuilding goals.
The FMB’s findings underscore the persistent economic difficulties facing small construction companies, with no immediate relief in sight.
