Groundworkers lay the foundations for economic recovery

Demand for groundworkers, a leading indicator of housebuilding activity, has surpassed the pre-lockdown peak, suggesting a V-shaped recovery is on the cards for the UK construction sector.

Ian Anfield, managing director, with Hudson Contract-sponsored apprentices at a site in Bridlington

Analysis of payroll data by Bridlington-based Hudson Contract, the industry’s biggest payer of subcontractors, showed the number of groundworks operatives paid last week reached 6,467.

This compares with the previous high of 6,261 in the week of March 16 and the low of 1,735 in the week of April 20.

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Groundworkers typically prepare construction sites for the shallow foundations of new homes.

Ian Anfield, Hudson's managing director, said: “Every trade follows the groundworkers so they are the best indicator of what is happening.

“We are quite surprised at these findings because a number of our large clients have not yet returned to full capacity with their labour needs.

“But many smaller construction firms are very busy as a result of pent-up demand to complete smaller housing developments."

Mr Anfield said that Hudson's field agents have told the firm that housebuilding activity is recovering strongly in places like Greater Manchester, but more slowly in the East Midlands.

Hudson said labour demand dropped to 30 per cent of capacity during April, but has now recovered to 74 per cent.

Meanwhile, earnings for subcontractors continued to recover last month.

Analysis of Hudson payroll data for more than 2,500 construction companies shows average weekly earnings of £848 for freelancers in June, compared with £827 in May and £734 in April.

The best-performing regions for earnings growth were the South West (+12 per cent), London (+7.4 per cent) and the North East (+4.4 per cent).

Hudson publishes the average pay for 17 different trades split across 10 regions in England and Wales.

The firm, which is one of Yorkshire's biggest family-owned businesses, supplies statistics to the Bank of England to keep policymakers updated with real-time insights on demand for skilled labour.