Gleeds CEO predicts public v private sector showdown as latest survey shows shortage of people and products

Gleeds’ latest Market Report, ‘Feeling the Burn’, has revealed industry fears that the availability of materials and labour is set to worsen over the coming quarter, impacting timelines and bottom lines on projects ranging from housing to HS2. 77% of the survey’s respondents said they expect price hikes and restrictions on products like steel frame, facades, and M&E packages to continue into the autumn, with potentially dire consequences.

84% of responses from contractors, consultants, and architects to a Gleeds poll reported delays to projects as a result of ongoing materials issues, and the business’ summer Report paints a concerning picture of what’s to come. In addition to rapidly increasing prices and dwindling stock, the survey found that contractors are also facing labour shortages, with the percentage experiencing recruitment problems increasing to 44%, up markedly from just 17.5% in the spring.

The findings echo recently released ONS data which shows that the skills shortage has intensified across the UK. The Office recorded the highest number of vacancies in the construction sector for 20 years between the months of March and May, with a whopping 35,000 roles waiting to be filled. With such a dearth of skilled labour, 63% of contractors told Gleeds that they had experienced subsequent increases to worker’s rates in their region, compared to 44% in the preceding quarter.

Graham Harle, Chief Executive Officer at Gleeds, said, “While our report makes plain the concerns of construction professionals around continued disruption to the supply of materials, it also highlights very real issues linked to a shrinking labour force.”

He goes on to add, ”The last time we saw this number of vacancies in the sector was 2001 – the year we witnessed the launch of the iPod and Wikipedia, and Tony Blair was voted in for second term in office. With huge public sector projects taking precedence, swallowing up as many people as they can in order to keep building, small and medium sized contractors are inevitably going to lose out. The knock-on effects will be far-reaching, extending to our ability to meet our carbon zero ambitions as prices rise and the essential retrofitting and repurposing of existing building stock takes a back seat.”