Over 71,000 jobs axed and 68,000 homes shelved in one year as banks’ inflexibility puts contractors in jeopardy

Total job losses in the industry over the past twelve months have exceeded 71,000, according to the latest figures from the Office for National Statistics.

The figures, which cover the period between October 2007 and the end of September 2008, show that the pace of redundancies has risen sharply since the summer, with some 31,000 jobs lost between July and September, compared with 13,000 in the second quarter, reports Building magazine.

The news came as Laing O’Rourke announced plans to axe staff, having begun redundancy consultations with 15 of the 100 staff in its Irish office. It’s also thought more employees will leave its UK business, although a spokesman declined to comment.

In addition, troubled housebuilder Taylor Wimpey confirmed that it had laid off a further 1,000 staff after carrying out a strategic review, bringing total job losses at the company to 1,900.

Plans for over 68,000 homes have been shelved this year, said research commissioned by Construction News from building and information specialist Emap Glenigan.

A total of 826 projects have been mothballed since January, many of them with contractors already onboard. Glenigan values the total amount of deferred public and private work at £11.7 billion. Last week alone, the research indicates that 35 schemes, worth £298.3m, were put on hold.

Civil engineering firms and subcontractors have warned of serious job losses unless the government forces banks to refinance credit and provide loans.

‘Banks are scrutinising their agreements with contractors and where they have even the slightest concern they are not renewing terms,’ said Patrick Waldron, chairman of the Civil Engineering Contractors’ Association, who was quoted by Contract Journal. ‘Developer-contractors are finding it harder to finance schemes, with banks asking for personal guarantees ... they are passing on the consequences and the SMEs are getting squeezed. But if the SMEs are allowed to fail then the whole industry fails.’

Eager to improve architects’ prospects during the recession, RIBA president Sunand Prasad has called for a massive Government-financed programme to make millions of existing homes more energy-efficient.

To prevent a repeat of the 1990s recession that saw 40% of architects lose their jobs, Prasad said the government should switch its focus from fast-tracking health and education projects to improving energy efficiency standards on seven million council and housing association homes over the next decade.

The UK Green Building Council and the Association of Consultant Architects offered their support for the measure, but Building Design reports that academics and architects questioned the value of the plans to the profession, with leading architect John McAslan describing them as ‘hopeless’.