Building firms set to shed more workers

A study from the Federation of Master Builders (FMB) warned that the economic recovery will be undermined as 29 per cent of small and medium-sized construction firms shed staff.

Richard Diment, director-general of the FMB said: “The SME construction sector has now been cutting employment levels for three-and-a-half years. What is concerning is that our latest survey shows that we have still not hit the bottom, with a third of SME builders reporting that they had been forced to reduce employment levels over the last three months.

“These job losses have damaging implications for the country’s economic recovery, and in particular the Government’s forthcoming Green Deal retrofit programme, as this erosion of the construction skills base will lead to a serious shortage of suitably skilled tradesmen.

“Previous recessions show that once people leave the construction industry they tend not to come back to it when the economy recovers – meaning that their skills are lost to the industry on a permanent basis. Even conservative estimates suggest we have already lost 125,000 skilled workers from the sector.

“Allowing the skills base to deteriorate in this way risks holding back the recovery by causing delays and driving up wage costs.”

More than a third (36 per cent) of construction SMEs expect to see workloads fall over the next quarter and nearly nine out of every ten firms fear costs will rise over the next six months, Mr Diment added.

“The picture is particularly bleak for the private new house building where expectations of an increased workload fell to just 19 per cent, and the public non-residential repair sector where 49 per cent of firms anticipate workloads declining over the next three months”

Mr Diment called for the Government’s Construction Strategy – to be launched on July 19 – to offer support for the industry or risk Britain not having the infrastructure and homes required when the country returns to prosperity.

Britain’s service sector performed better than expected in June but growth was still not strong enough to generate jobs, a purchasing managers’ survey showed on Tuesday.