All sectors of building industry are suffering, but private sector housing is hardest hit
Construction work has continued to fall and show little sign of improvement in the short term, according to the latest statistics from the Federation of Master Builders.
The State of Trade Survey produced by the FMB for the third quarter of 2008, shows a gloomy outlook for in conditions for the construction industry, as the housing market continues to deteriorate.
Construction workload balances were negative across all sectors, with private housing the hardest hit. More than 60% of respondents reported lower workloads compared with the previous quarter, and over 55% of respondents reported lower industrial workloads.
Notably, the FMB survey attributed lower work loads to continued delays to the government’s Building Schools for the Future programme.
Brian Berry, director of external affairs at the FMB, said the government needed to act quickly to restore stability in the building industry, with housebuilding now at its lowest since 1945.
The situation is deteriorating at an alarming rate and the government needs to take urgent action if the building industry is not to suffer any further
He suggested a five-point plan to kick start the building industry: making existing homes more energy efficient, reducing VAT on repairs and maintenance, simplifying the planning system, abandoning the Community Infrastructure Levy and reforming stamp duty.
“The situation is deteriorating at an alarming rate and the government needs to take urgent action if the building industry is not to suffer any further,” Berry said. “The tragedy of it all is that the is a serious undersupply of homes with over 150,00 on council house waiting lists. Action is needed not only to shore up the building industry but the thousands of families who need a home.”
The outlook for the industry was described as “muted” in the survey, and almost 50% of respondents said they expected their workload to be lower in the last quarter of 2008 than in the third quarter. Just 14% of firms are anticipating higher workloads.
The outlook for employment over the next six months remained similarly bleak, with 34% of respondents indicating a reduction in their workforce.
Significantly, there was also a mixed reaction in responses according to region. Firms in Greater London remained the most optimistic, and those in the North-west the least positive.