Smaller housebuilders are still feeling the squeeze, warns survey

An industry pressure group has raised concerns that smaller building firms are still being squeezed, despite Government initiatives which are aimed at increasing competition.

New build workloads for small housebuilders in the social housing market are at their lowest level since 1999, according to the Federation of Master Builders’ (FMB) State of Trade Survey.

Brian Berry, the chief executive of the FMB, said yesterday: “Around 66 per cent of building companies reported lower workloads, a marked increase from 47 per cent at the end of 2011.

“The private new housing sector fared little better with around 55 per cent of firms indicating that workloads had fallen in the first three months of 2012, compared with 45 per cent in the last three months of 2011.

“The fact that workloads for small housebuilders are at an all-time low is very worrying given the nation’s chronic shortage of affordable housing.

“Although the Government has introduced a number of promising initiatives to try and help the industry, support tends to be awarded to the large volume housebuilders, meaning SMEs still miss out.”

Mr Berry said that the industry had lost around 69 per cent of its smaller firms since the late 1980s.

The FMB is calling for a reduction of red tape to make it easier for smaller building firms to compete with larger rivals.

Mr Berry added: “What is really worrying is that our survey shows that the SME building sector has now been in recession for four years. These dismal results for small builders demonstrate the length and severity of the recession in the construction sector. It is not helped by the fact that 84 per cent of firms expect building materials costs to increase over the next six months.”

The FMB trade survey has monitored key indicators and predicted developments in the UK construction industry for more than 20 years.

The survey measures workloads, employment levels and optimism about the future.

The FMB was established in 1941 to protect the interests of small and medium-sized building firms.

It also offers advice to consumers through its ‘Find a Builder’ and ‘Check a Builder’ websites.

For more information visit the website www.fmb.org.uk