House Building Costs and Labour Survey
The inaugural Housebuilding Costs and Labour Survey for Q1 2025 has found that output in the UK housebuilding industry is set to increase in the coming 12 months – but a lack of skilled labour is resulting in recruitment difficulties amidst rising costs.
𝗟𝗮𝗯𝗼𝘂𝗿 𝘀𝗵𝗼𝗿𝘁𝗮𝗴𝗲𝘀 𝗽𝗲𝗿𝘀𝗶𝘀𝘁
• 32% of respondents say that the availability of skilled labour has decreased in the past six months
• 86% of firms find recruiting skilled workers difficult
• 81% expect labour costs to rise over the next 12 months
𝗠𝗮𝘁𝗲𝗿𝗶𝗮𝗹 𝗰𝗼𝘀𝘁𝘀 𝗸𝗲𝗲𝗽 𝗰𝗹𝗶𝗺𝗯𝗶𝗻𝗴
• 95% of businesses report rising material prices
• A further 84% expect costs to increase further this year
𝗪𝗼𝗿𝗸𝗹𝗼𝗮𝗱 𝗮𝗻𝗱 𝘁𝗲𝗻𝗱𝗲𝗿𝗶𝗻𝗴 𝗮𝗰𝘁𝗶𝘃𝗶𝘁𝘆 𝗼𝗻 𝘁𝗵𝗲 𝗿𝗶𝘀𝗲
• 65% believe workload levels will rise over the next six months
• 51% are seeing more tendering opportunities
𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗳𝘂𝘁𝘂𝗿𝗲 𝗵𝗼𝗹𝗱?
Material and labour costs will continue to rise but the level of skilled labour available remains limited, squeezing productivity as well as the margins of contractors already under pressure.
𝗪𝗵𝗮𝘁 𝘀𝗵𝗼𝘂𝗹𝗱 𝗰𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝗼𝗿𝘀 𝗱𝗼?
• Review fixed price periods on current contracts and discuss cost increases with developers.
• Discuss labour and resource challenges with housebuilders and review build programmes collaboratively.
• Place greater emphasis on reliability and quality at tender stage, over simply reducing margins.
𝗪𝗵𝗮𝘁 𝘀𝗵𝗼𝘂𝗹𝗱 𝗵𝗼𝘂𝘀𝗲𝗯𝘂𝗶𝗹𝗱𝗲𝗿𝘀 𝗱𝗼?
• Recognise the rising cost trends in the market and engage in open discussion with the supply chain.
• Ensure the cost increase burden is shared fairly.
• Review fixed partnerships contracts to identify exposure and put mitigation plans in place.
• Pay the supply chain fairly and on time.
We are pushed to work at margins very close to the cost price, which is very tough for small businesses like ours. It appears that developers have certain budgets which are almost impossible for us to meet”
“Prices are being squeezed at a time when labour prices and business rates are going in the opposite direction. It would unfortunately be no surprise to see more firms closing over the next six to twelve months.”
“General feeling is that price is more important than quality at tender stage”
“The Government is saying build, but most open market developers are slowing down.”
“Output is slow – tenders received are on the up, but the outcome of these, if secured, won’t be seen for another six to nine months.
Brookbanks Services
How can Brookbanks help?
How can we help you and your business?
- Structuring, maintaining and managing accurate budget and precise cash flow forecasts
- Managing contractual obligations effectively to prevent disputes and ensure smooth progress
- Coordinating project elements to ensure timely and cost-effective completion
- Strategic review and delivery of assessments, appraisals to ensure efficient implementation
Get in touch to discuss further, or find out how we can help you and your business: ben.wakeling@brookbanks.com
Cost & Commercial Group
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Group Director of Cost and Commercial
Anthony Brown
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Commercial Director
Ben Wakeling
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Senior Cost Consultant
George Wood
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Project Cost Consultant
Ismail Ali
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Senior Cost Consultant
Jaskaran Singh
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Graduate Cost Consultant
Shiv Raja
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