80% of SME builders forced to raise prices as material availability falls

According to the latest quarterly State of Trade survey from the FMB, builders’ workloads and enquiry levels were at their highest point for a decade in Q2 — but it is being matched by widespread material price hikes.

Some 71% of builders received higher numbers of enquiries for future work than in the previous quarter.

Activity in all sectors increased, but overall growth was led by repair, maintenance and improvement, with 59% reporting greater workloads.

However, the survey also highlighted a steep surge in material prices and a growing struggle to secure labour — especially carpenters and bricklayers.

More than half of builders (53%) struggled to hire carpenters/joiners (up from 23% registered six months ago), while 47% of UK SME construction firms faced difficulties finding bricklayers — an uptick from 22% in Q4 2020.

Almost all respondents (98%) are facing material price rises, with the same number expecting this to continue in the following quarter.

Consequently, 80% of firms have been forced to raise their prices.

Brian Berry, chief executive at the FMB, said: “Today’s FMB State of Trade survey tells a tale of extremes. 

“While it’s brilliant to see small, local building companies and sole traders bouncing back from the difficulties of 2020, record workloads and enquires are bringing significant challenges.

 “An extraordinary 98% of small builders now face rising prices for building materials, with the same number expecting this to continue into the autumn. 

“Half of those who responded to our survey are struggling to hire a carpenter or a bricklayer — without these fundamental inputs, how can Britain build back better?

“In the absence of greater support from government and industry to explain to consumers why prices are going up, I fear a growing number putting themselves at the mercy of cowboy builders seeking to undercut quality tradespeople. 

“To address the skills crisis so starkly presented by this new data, industry efforts to encourage more people into construction must be supported at the spending review with further investment in colleges.”

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