FMB warns of mounting problems for builders

5 February 2019

Growth in the construction industry could be held back by a weakening housing market, rising costs and an increasingly nervous banking sector, according to the Federation of Master Builders (FMB).

The FMB’s latest State of Trade Survey showed that workloads for construction SMEs grew in Q4, 2018. Despite this, there are serious concerns about the mounting problems facing small building firms, said the organisation, including:

  • 42% of builders have detected signs of a weakening housing market;
  • Carpenters overtake bricklayers as the trade in shortest supply with nearly two-thirds (64%) of construction SMEs struggling to hire carpenters and joiners and 61% struggling to hire bricklayers;
  • One in five construction SMEs have had projects stalled in the past three months due to delays to loans, or loan refusals, from the banks.

The survey shows that only a third of construction SMEs anticipate higher workloads in Q1 and that 87% of builders expect material prices to rise further in the next six months.

“Mounting Brexit uncertainty is starting to have a tangible effect…and uncertainty is the enemy of small building firms. Most construction SMEs work predominantly in the refurbishment sector and they rely heavily on the confidence of homeowners to spend their cash on home improvement projects.

“Brexit deal aside, the government is also happily ignoring the views of business as it designs its post-Brexit immigration system. If the Immigration White Paper remains as is, the construction industry will not be able to hire sufficient numbers of tradespeople from abroad and the industry will stall. The government’s house building targets will therefore be no more than a fantasy.”