Key Findings - 3rd Quarter 1999 Total workload of FMB survey respondents clearly increased from the second to the third quarter of 1999, though possibly not by more than the normal seasonal upswing associated with longer daylight hours and better weather in the summer. There is still a contrast, however, between the experience of builders and that of specialist contractors, with the latter still showing a downturn. By region, relatively the strongest growth was recorded in London Region, Eastern Counties, and Yorkshire & Trent. Only the Midlands and South Wales indicate a fall. By type of work, private commercial and private industrial new build and refurbishment have shown increases, as have repair, maintenance and improvement of both private and social housing. Both private and social housing new build, and R&M of all non-residential buildings, have disappointed. Employment trends over the last quarter, overall, by type of firm, and by region, have been mostly in line with those in workload. Looking ahead, it is normal for firms to anticipate some downturn in the final three months of the year. For the last quarter of 1999, however, FMB survey respondents anticipate only a relatively slight reduction in activity and jobs. This expectation receives support from positive results from the question on the trend in enquiries regarding future work, though several respondents have added comments to the effect that, whilst enquiries have clearly increased, relatively fewer have led to firm orders. The upturn in activity is reflected in some tightening of the labour market. For the country as a whole the change appears relatively modest, but in the London Region and Southern Counties the increase in problems has been more marked. The changes in the labour market situation have been mainly in respect of the balance of demand for and supply of carpenters and joiners, and also of bricklayers, with relatively little change in respect of other skills. The increase in workload has not been accompanied by any noticeable increase in difficulties or delays in obtaining materials. It is still joinery that is mentioned most commonly as being subject to delivery delays of more than two weeks, but these have been mentioned by no more than 3% of respondents. Written-in comments show that some firms are concerned over the possible implications of increasing concentration in the building materials distribution industry, following mergers of leading merchants. However, the issue that emerges from the survey as currently causing most concern for FMB members is the Construction Industry Scheme for taxation of sub-contractors in the industry. As well as increasing the burden of red tape, the CIS is adding to pressures on cash flow and profitability by raising labour costs in respect of additional direct employees, and by intensifying competition as people move out of the pool of sub-contractors and start bidding for work on their own account. First posted: 19 October 1999. Last modified: 21 January 2000.