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Workloads for builders in most parts of the country have continued to increase reports the Federation of Master Builders in its State of Trade Survey for the Second Quarter 2001. The expectation is that growth will continue but at a slightly slower rate during the third quarter. Despite full order books, builders report that it is red tape, rather workload levels, that prevents them from shortening the time that customers have to wait until their project can be started. 42% of builders report having to spend two days a week dealing with red tape rather than being out on site.
During the second quarter of the year, builders' workloads increased by 39% over the same quarter last year. This follows a 26% increase in the first quarter. The rise in workloads is led by a continued growth in orders for the repair, maintenance and improvement of private and social housing of 30% and 19% respectively. The repair and maintenance of public and non-residential buildings has also shown an increase of 15% and 13%. New build work is also led by the private domestic sector with an increase of 18%. A small increase has been reported for industrial and commercial work. Looking ahead, four out of ten builders expect further growth in workload against 15% who expect a downturn.
There is evidence that the ongoing foot and mouth outbreak has reduced demand for building work from hotels and other tourism-related businesses in the regions worst affected by disease, notably the South West and North West of England. While in Northern England and the East Midlands, concerns of a slow down in the manufacturing industries have slowed the growth of expected orders for builders.
"The large amount of red tape and bureaucracy continue to be a major problem for builders", reports Ian Davis, Director General of the Federation of Master Builders. He explains: "In addition to the avalanche of paper work that threatens to bury many businesses, builders also have to contend with the complicated bureaucracy of the Construction Industry Scheme for the employment of sub-contractors. This means that they are forced to spend more time in the office and less time out on site working on customers' projects. Two days out of every working week are taken up by paper work."
Builders are also faced with a very tight labour market with 71% reporting difficulties in recruiting skilled craftsmen. Bricklayers, carpenters and joiners are the most difficult to find.
"On the whole the building industry is so far bucking the downturn being experienced by other sectors such as manufacturing and IT," says Davis. "This is mainly because of the strong demand from home owners for maintenance and improvement work which demonstrates a high level of consumer confidence that is at odds with the predictions of economic downturn."
First posted: 3 August 2001. Last modified: 3 August 2001.
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