The Federation of Master Builders has revealed the findings of its latest State of Trade Survey (Q2 2024), with SME building firms “reporting signs of stability” as workloads increase 7% and enquires rise by 3% over the last three months.
CEO Brian Berry said: “The FMB’s latest survey for Q2 2024 has shown continued stability. While this represents a clear improvement on the challenging market conditions SME builders were experiencing in late 2023, and offers a glimmer of hope for the future, there is still substantial room for improvement.
“Increasing workloads are a positive sign that the construction industry is slowly growing. However, firms are continuing to face difficulties in recruitment, which has been an ongoing issue. It’s also worrying to see a significant rise in the number of businesses reporting lower than expected profits this quarter, 55%, up from 44% in Q1 2024, which shows the challenges the UK continues to face.”
Brian continued: “The new Government has used its early weeks in office to announce promising plans to boost house building rates and reform the planning system, which may result in a much-needed economic stimulus. However, the UK is currently experiencing a construction skills crisis, and concerns remain about viability without the workforce in place to deliver new homes.
“The Prime Minister’s speech laying the groundwork for Skills England was hopeful but lacked detail. We need to see a long-term skills plan to deliver the Government’s ambitions for growth.”
Key findings from the FMB State of Trade Survey for Q2 2024:
Market conditions:
There has been a slight increase in total workloads with a slight decrease in total enquiries.
Reported net change in workloads was up by 7% on Q1 2024, with slightly more members reporting an increase than decrease. Reported enquires were up 3%.
Employment over Q2 of 2024 have improved significantly (net change -2% from the -11% reported previously).
42% of FMB members reported a decrease in enquiries with 33% seeing an increase.
Skills:
54% of FMB members reported no changes in employment levels in Q2 2024 compared with Q1 2024.
41% of members are struggling to hire carpenters, up from 31% in Q1 2024.
29% are struggling to hire bricklayers, slightly up from 25% in the previous quarter.
43% of members have reported shortage of skilled tradespeople has resulted in job delays, up from 36% in Q1 2024. Cancellations are slightly down at 8%, compared with 9% previously.
Changes in prices and costs:
64% of members report that material costs increased in Q2 2024, down from 69% in Q1 2024.
The impact of increased outgoings has led to 67% of members increasing the prices they charge, with 52% reporting that their business in on track to make a loss or fall below expected margins, significantly up on 44% in Q1 2024.
10% of members report having had to make staff redundant or terminate contracts due to cost pressures, slightly up from 9% previously.
Click here to read the full report.
