The 2024 first quarter state of trade survey from the Federation of Master Builders (FMB) found that 44% of members says their business is on track to fall below expected margins.
Deteriorating profits come despite builders putting up their prices.
Increase in material costs over the past quarter means that 65% of FMB members report that they have needed to increase prices.
The FMB state of trade survey found that workloads were up 6% on Q4 2023 but 44% of members reported a decrease in enquiries.
Overall, recruitment difficulties have eased slightly, with the exception of general labourers who are more difficult to find – 28% struggled to hire them compared to 24% last quarter; 33% of members are struggling to hire carpenters; 28% are struggling to find bricklayers, which has dropped considerably from 35% in the previous quarter.
FMB chief executive Brian Berry said: “Last year was challenging for small builders across the UK, and while Q1 of 2024 has shown stabilisation, it is clear the situation remains concerning. The data being seen for workloads and enquiries are settling in negative figures, similar to those seen between 2010 and 2013, when the UK economy was particularly impacted by austerity measures and limited spending power. There are clearly deep-rooted problems within the UK economy that need addressing.”
He continued: “There have also been positive signs to take from these figures. We have seen improvements in the availability of skilled workers, with bricklayers and carpenters becoming easier to hire, and overall workloads are up by 6% on the previous quarter. However, with almost half of members reporting a decrease in enquiries, more than two thirds report escalating material costs, and 44% of Master Builder companies say their business is on track to fall below expected margins this year; it is adding up to a deeply alarming picture.”
