The fortunes of Scottish builders changed in late 2022 as workloads and enquiries bounced back from their low summer numbers. This comes from data in the latest Federation of Master Builders (FMB) State of Trade Survey which indicated there was a healthy amount of work around for small, local builders throughout Autumn.
The survey paints a different picture across the UK however, where there has been a continued decline in workload and employment with significant declines in enquiries. This suggests that consumers are much less inclined to take forward new projects. Therefore, as we progress through 2023 there could be a decline in work for builders, during a tricky period economically.
The new FMB data indicates that out of all the UK nations, the picture in Scotland is quite positive which is a complete turnaround from the previous quarter where the figures indicated that Scottish builders had the lowest workloads and enquiries. The latest figures suggest workloads have increased to 21% from -15%, with enquiries settling at 0%, meaning there was an equal balance saying they had received more or less enquiries in Q4 2022. Despite enquiries being reported at such a low figure, this was still the highest recorded across the UK with all other countries in negative numbers.
The FMB State of Trade Survey, which is released quarterly, is the longest-running survey of its kind to track the experience of small to medium-sized (SME) construction firms in the UK. The latest survey for Q4 2022 found:
Scottish market activity
- The net balance for workloads has considerably improved compared to last quarter at 21% compared to -15% last quarter.
- Work enquiries are reported at 0% which means an equal number of builders reported having more or less enquiries.
UK market conditions
- Both workloads and enquiries decreased in Q4 2022 compared to Q3 2022 on balance in all sectors.
- In terms of total enquiries, 41% of FMB members reported a decrease in Q4 compared to Q3 2022, with only 29% saying this had increased.
- House building activity has fallen 17% from 1% to -18% compared to Q3 2022. Reported enquiries for new house building projects have dropped 11% from -8% to -19%.
Skills
- 15% of FMB members report an increase in the number of employees within their company’s workforce in Q4 2022, with 19% saying it had decreased.
- Around a third of FMB members are struggling to recruit carpenters/joiners, bricklayers and general labourers (39%, 35%, and 30% respectively).
Prices
- 89% of FMB members reported an increase in material costs in Q4 2022.
- 85% of respondents expect material costs to increase in Q1 2023.
- 70% of builders have put up their prices for work.
Gordon Nelson, Director of FMB Scotland, said: “Despite the cost-of-living pressures and the weakening state of the UK economy during the autumn, reputable local building firms in Scotland had buoyant workloads. This positive news contrasts with the results from the other home nations but is consistent with the conversations I held with FMB members right across Scotland."
Nelson continued: “Of course, labour shortages continue to hamper the hopes and ambitions of Scotland’s construction sector. At the same time, local trade and building firms are continuing their plans to recruit and train apprentices. This is evidence of the determination of the bosses of local building firms to bring much needed talent into their businesses. However, there are present challenges with apprenticeship funding and the capacity of colleges to train construction apprentices in Scotland.”
Nelson concluded: “With Scottish Apprenticeship Week a little over a month away, the Scottish Government needs to engage with the construction industry and colleges to resolve the present problems. With a skills delivery system that provides high quality training of the next generation tradespeople, local construction firms will have the confidence to invest in their business. Without a burgeoning base of local building firms, we will struggle to meet the challenge of decarbonising our existing buildings to help Scotland meet its net zero 2045 target.”
Notes to editors
The Federation of Master Builders (FMB) is the largest trade association in the UK construction industry representing thousands of firms in England, Scotland, Wales and Northern Ireland. Established in 1941 to protect the interests of small and medium-sized (SME) construction firms, the FMB is independent and non-profit making, lobbying for members’ interests at both the national and local level.
The FMB is a source of knowledge, professional advice and support for its members, providing a range of modern and relevant business building services to help them succeed. The FMB is committed to raising quality in the construction industry and offers a free Find a Builder service to consumers.
