Construction pay continues to rise across the UK

The latest report from Hudson Contract shows that in the majority of regions in the UK, average pay for freelancers in the construction sector continues to rise.

The payroll survey by the UK’s largest Construction Industry Scheme (CIS) contract, audit and payroll provider, analyses some 2,200 firms in the industry, and saw some regional variation in monthly rises, with the South West and South East having the largest increases (3.0% and 2.8% respectively), while two regions saw a downturn, with the East Midlands and London falling 0.1% and 1.1% respectively.

Year-on-year, every region saw a significant rise, showing a national average of 8.1% to an average weekly wage of £899. Regionally, this is led by the North East, where a 2.0% month-on-month and 10.6% annual rise equates to £780 per week, followed by Yorkshire and The Humber (9.6% to £842).

East Midlands performed worst over 12 months, though still a healthy 6.0% up on March 2018 and still at the top regional average wage of all, now £965 a week.

Here’s the March 2019 monthly chart from Hudson Contract’s survey:

Trades themselves also saw a variation of pay changes and average wages. The biggest winners are mechanical & engineering, up 7.4% to £1,137; shop fitters, increasing by 4.8% to £1,227; and bricklayers, rising 4.8% to £781. Some have seen average pay fall, the worst of them plastering down 2.5% to £783, and insulation and steel & timber frame erection, both sinking by 2.7% (to £921 and £774 respectively).

Ian Anfield, managing director at Hudson Contract, said: “Our figures show demand stayed strong for skilled tradespeople across the regions in England and Wales last month. However, the fall in average freelance weekly earnings for tradespeople in London could have been caused by a combination of political uncertainty and a slowing housing market in the capital. This view might be supported by the decrease in weekly pay of 1.5% for plumbing and electrical contractors in London.”

Of the economic outlook for construction, he commented: “The fall in commercial work is due to Brexit uncertainty which is causing businesses to hold back on new investment. The weak pound, a sign of this uncertainty, is increasing the cost of importing steel, concrete, plaster and plastic building products, which is leading to input inflation.

“We are also seeing tier two contractors pricing up work for the tier one contractors to reflect the risk of dealing with the financially troubled outsourcing sector.

“The fall in civil engineering activity is likely caused by a number of large government-led infrastructure projects such as Crossrail winding down, whilst new projects like HS2 are still in their early stages. The rise in residential building is a reflection of pent-up demand for new housing in the UK.”

He concluded: “Whatever happens with Brexit and the wider economy, the construction industry will continue to rely on self-employed tradespeople and their ability to supply specialist labour. Their steady rise in earnings over the last year highlights the general shortage of skills in the sector and good financial incentives for young people to learn the trades.”