Growth among construction SMEs slowed in most parts of the UK in the third quarter of this year, according to the Federation of Master Builders (FMB).
The FMB’s latest State of Trade Survey, a quarterly assessment of the UK-wide SME construction sector, found that although construction SME workloads remained positive in Q3 of 2018, they grew at a slower rate than they did in the second quarter of the year.
The survey also found that 86% of builders reported increasing material prices in Q3 2018 (up from 76% in Q2 2018), with more than two-thirds (68%) of construction SMEs struggling to hire bricklayers. 59% are struggling to hire carpenters and joiners. The survey also found that more than half (58%) of construction SMEs expect salaries and wages to increase over the next six months.
Brian Berry, Chief Executive of the FMB, said: “Growth among the UK’s construction SMEs slowed in the third quarter of this year. A range of factors are at work here, not least ever increasing material prices. Anecdotally, we are hearing worrying reports of banks withholding previously agreed funding for projects which is delaying start dates and dampening growth. This may or may not be related to Brexit-nerves.”
Berry continued: “This slowdown in growth should ring alarm bells for the UK Government and give rise to a total rethink of its misguided post-Brexit immigration proposals. Currently, the Government wants to significantly limit the number of construction workers coming into the UK post-Brexit, labelling them ‘low skilled’ and therefore somehow surplus to requirements. Migrant construction workers are indispensable with 13 per cent of our construction workers being from outside of the UK. If construction firms are unable to hire migrant workers post-Brexit, the already severe skills crisis will worsen.”