Rising prices but small builders are showing resilience
BRITAIN’S SMALL builders are delivering a “resilient” performance despite facing rising material prices, according to the Federation of Master Builders (FMB).
The FMB said that workloads of small and medium-sized (SME) construction firms grew slightly in the first three months of this year despite record numbers of builders reporting rising material prices.
The FMB’s latest State of Trade Survey, which is the only quarterly assessment of the UK-wide SME construction sector, found that more construction SMEs predicted rising workloads in the coming three months, up from 38 per cent in the previous quarter to 49 per cent in Q1 2018.
Brian Berry, chief executive of the FMB, said: “Workloads for builders continued to grow in the first quarter of 2018 despite the ‘Beast from the East’ wreaking havoc across the UK’s construction sites.
“However, once again, the growth we are seeing is slower than in the previous three months and this can be partly attributed to pressure from rising costs. Indeed, 90 per cent of builders reported increasing material prices in the first three months of 2018 and this is the highest reading on record. Insulation, bricks and timber are the materials that have increased the most and builders are predicting these price increases will continue.
“We are also seeing increased salaries for tradespeople stemming from the acute skills crisis and that, coupled with material price hikes, are squeezing margins and stifling growth for construction firms of all sizes.
“In terms of housebuilding, these latest results should sound some alarm bells with the workloads of SME housebuilders dropping off in the first quarter of this year. In 2017/18, 197,000 homes were started in England but this is some way off the Government’s target to build 300,000 homes per year.”