Construction workforce shrinks to year-low

15 April 2011

The construction workforce has shrunk to its lowest level in 12 months, according to figures from the Office of National Statistics.

Building reported that the total number of construction sector jobs shrunk 0.4% on the previous quarter, to hit 2,128,000, the lowest level since March 2010.

The total number of jobs is 2.4% less than in December 2009 and includes 44,000 public sector-related jobs.

However, bucking the trend, Wates Group announced plans to take on 300 new employees this year to underpin the contractor’s expansion plans for 2011, Construction Enquirer reported.

The news came as Wates posted a 12 per cent rise in pre-tax profit to £43.5m in 2010, on turnover up 4 per cent to £985m.

Chairman and chief executive Paul Drechsler said: “I am particularly pleased to report a year-end balance sheet that is one of the strongest in the industry, a forward order book of £2bn and a total pipeline of new business opportunities worth £4.1bn.

“To help deliver our ambitious growth strategy, we expect to hire around 300 new people in 2011.”

Meanwhile construction output grew in February, ending a run of five consecutive monthly declines, according to the latest figures from the ONS, Building reported.

But although output rose 8.6% compared with January - the largest monthly increase since the 18.1% recorded in March 2010 - the figure was still down 0.3% on February 2010.

Simon Rubinsohn, chief economist at the RICS, said: “Construction output rebounded in February, following the disappointing figures for January. The latest reading is only marginally above the December number, which was adversely affected by heavy snowfall.

“The latest data questions whether private sector demand is going to be sufficient to offset the cuts in public spending”, he said.

The latest market forecast from Experian, reported by Building, predicts that construction output will fall in 2011, but not as much as expected because of a gradual recovery in the private sector.

The report said that construction will shrink by 2.1% this year as public sector spending cuts begins to bite, but this is significantly better than the 3.6% drop anticipated in the winter 2010/11 construction forecast.

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