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The Federation of Master Builders State of Trade Survey for the third quarter 1999 shows a clear increase in workload from the second quarter. This is mainly due to the seasonal upswing associated with longer daylight hours and better weather in the summer plus improved economic conditions.
The Regions fared well overall, with the Eastern Counties again showing a strong increase with 5% over the third quarter. London and Yorkshire & Trent also showed strong increases. The general north/south divide showing in the second quarter has evened out, with a clear improvement in all areas except South Wales and the Midlands, which have seen a downturn of 11%. The largest improvements were in the Northern and South Western Regions.
For general builders, private commercial and private industrial new build and refurbishment have shown increases, as have repair, maintenance and improvement of both private and social housing. However, the workload for private and social housing new build and repair and maintenance of non residential buildings has not been strong. This is disappointing in view of the Government's Capital Receipts Initiative intending to increase funding for social housing, including refurbishment, from £200m in 1997/8 to over £600m in 1998/9.
Expectations of workloads for the fourth quarter are slightly lower than the third quarter due to the seasonal changes, apart from the South Wales Region where the view is optimistic despite the present lack of work. The level of enquiries about possible future work has risen, particularly in the Northern Counties, but it is increasingly the case that these do not always come to fruition.
Recruitment has become an increasing problem. The problem of finding direct employees has risen by 4% to 43%, and the problem of finding sub-contractors by 4% to 38%. As in the first and second quarters carpenters and joiners are the category of skilled labour most difficult to recruit, whilst bricklayers are also increasingly difficult to find. In both London and the Southern Counties the proportion of firms finding difficulty in recruiting carpenters and joiners as direct employees has risen to over 50%.
Derrick Ovington, FMB National President, commenting on the survey said:
"Although the workload is steady and our members are generally optimistic for the future, there are still genuine causes for concern. The one that causes the most is the Construction Industry Tax Deduction Scheme, intended to simplify income tax procedures within the building industry and help stamp out the cowboy builder. However, in practice this appears to be hampering our members.
"A significant number of members report a movement of tradespeople from being sub-contractors into becoming direct competitors with the firms for which they used work, and not charging VAT for their services because they are below the threshold. The CITDS has also added further to the burden of bureaucracy and red tape that seems to bear particularly heavily on small building firms, who can ill-afford the time and resources needed to cope with it."
Further Information
For further information, please contact:
Federation of Master Builders
Gordon Fisher House
14-15 Great James Street
Holborn
London
WC1N 3DP
Tel: 020 7242 7583
Fax: 020 7404 0296
First posted: 19 October 1999. Last modified: 12 July 2000.
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