FMB: workloads for SME construction firms slip for first time since 2013

Workloads for SME construction firms have dipped for the first time in six years, according to new research from the Federation of Master Builders (FMB).

The FMB’s State of Trade Survey for the first three months of 2019 has revealed that SME workloads declined for the first time in six years, with 29% of respondents reporting lower workloads than in the last quarter of 2018.

This is up from 13% in the final three months of last year.

And while skills shortages eased slightly the FMB said this was likely due to less competition for workers because of lower workloads.

Bricklayers were in shortest supply, with 64% of firms having difficulties hiring them, followed by carpenters, who posed a challenge for 59% of SMEs.

Brian Berry, chief executive of the FMB, said the workload dip followed three years of political uncertainty, which had taken their toll on the SME construction sector.

“A perfect storm of diminished consumer confidence, rising material prices and increases in wages and salaries has resulted in the construction SME sector detracting for the first time in six years,” Berry said.

Almost 88% of builders said they thought material prices would increase over the next six months a figure Berry labelled “record breaking”.

Around 70% of SMEs also expected wages and salaries to increase over the next six months, up from 66% in the previous quarter.

Berry said: “This is bad news for builders and consumers alike as construction projects, large and small, become more expensive to deliver.”

Berry said the government needed to step in to boost the economy amid Brexit uncertainty.

He said this was why the FMB was calling for a reduction in VAT from 20% to 5% on all housing repair, maintenance and improvement work.