Construction skills shortages in Midlands
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Construction is taking of again and reports are now coming in of shortages in tradesmen and materials which are needed to keep up with demand.
According to the RICS survey for the final quarter of last year capacity constraints are now being felt outside the south east and are spreading to the Midlands.
Many Construction surveyors also warned growing numbers of subcontractors are becoming more choosy about the work they bid on and the quotes they are putting in and in just six months into the recovery surveyors are more upbeat than they have been since the RICS survey started nearly 20 years ago.
This sees more than 74% more chartered surveyors expecting workloads to increase rather than decrease during 2014 and during the final three months of the year, almost 40% of surveyors warned that a scarcity of materials is limiting activity with bricks and concrete blocks in short supply.
Skills shortages are increasing across all of the trades with bricklayers particularly scarce due to strong demand from the housing sector.
A higher percentage of respondents are now reporting problems sourcing relevant skills than at any time since mid-2006 which is an encouraging sign
In London, John Busby at Mace’s cost consultancy warned: “Tenders are becoming harder to bring in within budget and contractors are becoming more risk averse.”
The survey also revealed supply constraints are now hitting the Midlands, East Anglia and North West which proves the recovery really is on.
Phil Hodges of Ridgeways in Redditch, said: “The general upturn in confidence continues, and certain sub-contractors are stating they are ‘flat out’.
“It is becoming increasingly difficult to get tender returns from sub-contractors on behalf of main contractors – some already seem confident enough about future workload to be able to ‘choose’ the work they want to tender.”
In Norwich, Michael Harris at Philip Pank & Partners, said: “The general upturn in housebuilding has resulted in a shortage of bricks and blocks, and also increased labour costs, particularly in bricklaying.”
Surveyors in the north west are just starting to see a recovery lead by Manchester and Liverpool jobs.
Willmott Dixon’s Manchester office surveyor Athony Dillion warned: “The market remains very competitive with an increased risk of failures due to increasing labour and material costs.”
But outside of these more southerly regions near Newcastle signs of improvement are slowly comming.
In Newcastle Michael Foggon of Faithful+Gould, said: “There are signs of recovery, particularly in housing and industrial but it is still too weak to restore the much needed confidence.”
Financial constraints remain the most significant impediment to higher growth, with 73% of respondents reporting this as the factor most impairing higher activity levels.
With tender prices now appearing to have bottomed out and building material costs still rising at a relatively modest rate compared to previous years, surveyors are more confident now that profit margins will increase than at any time in the last 15 years.
Good news all round for tradesmen then particularly bricklayers it would seem.
By Gregory Nelson