Welsh construction industry is teetering, warns FMB Cymru

The pace of growth among local builders in Wales has slowed and enquiries about future projects are starting to dry up, according to the Federation of Master Builders (FMB) Cymru.

Key results from the FMB’s State of Trade Survey for Q2 2019, which is the only quarterly assessment of the UK-wide SME construction sector, include:

• UK-wide, there was a decrease in employment levels among small construction firms for the first time in more than five years with over one fifth (21%) of employers reporting a reduced workforce;
• UK-wide, after a difficult start to 2019, workloads for construction SMEs grew slightly compared with the previous quarter with more employers (27%) reporting higher workloads than in the first quarter of this year (22%);
• In Wales, in terms of the overall score for workloads, expected workloads and enquiries, there was a big drop of 24 percentage points compared with the previous quarter; and
• Bricklayers are the trade in shortest supply with nearly two-thirds (60%) of construction SMEs struggling to hire these tradespeople and 54% struggling to hire carpenters and joiners.

Ifan Glyn, Director of FMB Cymru, said:

“Local builders in Wales are still busy but there are warning signs we can’t ignore. Lots of construction employers are starting to see enquiries about future projects drying up, which is no surprise given that the threat of a no-deal Brexit looks increasingly plausible. Homeowners in Wales are sitting tight to see what happens to the economy before committing to commissioning significant home improvement works, such as loft conversions and extensions. This is the bread and butter of your typical local building firm so we aren’t surprised to see the pace of growth slowing.”

Glyn concluded:

“At least we now know the identity of our new PM and we’re urging Boris to show his credentials as ‘Boris the builder’ and stimulate the economy through increased activity in construction. If Boris wants to cut taxes, he should look no further than the domestic building sector. Indeed, nine in ten builders believe that the single best thing Boris can do to avoid a downturn is to reduce VAT on home repair, maintenance and improvement projects from 20 per cent to 5 per cent. Let’s give homeowners a good reason to stop sitting on their hands until Brexit is behind us and start commissioning their home improvement projects today.”