Wage inflation ‘starting to level off’ on building sites

Earnings for self-employed tradespeople increased by just 0.5 per cent last month, according to our latest Pay Trends data. Average earnings rose to £946 per week during May. This was 3.1 per cent higher than the same period last year.

Hudson Contract’s managing director Ian Anfield said: “We are seeing signs that wage inflation is starting to level off. While this might relieve some cost pressure on construction SMEs, the headwinds for housebuilding are continuing to grow. 

“It looks like a perfect storm is brewing in the UK housing market and the question is whether the government and Bank of England have the navigational skills to steer a course through it.

“Millions of borrowers will be coming off fixed rate mortgages and facing huge increases in their monthly bills over the next few months.

“With a general election looming, the Chancellor will be watching closely to see if the package of support he has agreed with lenders to help residential borrowers will be enough to keep the show on the road.”

Ian added: “Of course we are concerned about the housebuilding sector. With people struggling to afford mortgages and some ill-thought-out legislation around planning, the impact on new-build housing could be devastating.

“Thankfully we have not seen a dip in subcontractor activity yet, but some clients are telling us they can see projects on greenfield sites for major housebuilders starting to slow, so they are moving onto projects on brownfield sites for public-private partnerships or working over wider areas.”

Of the trades, bricklayers enjoyed the best earnings growth last month with average weekly pay rising by 6.2 per cent to £925.

To view our interactive pay trends map click here

Hudson Contract is the UK’s largest provider of tax status and employment contract services to the construction industry with annual revenues of £2 billion and a client base of 2,600 construction SMEs.

Our family-owned group delivers the most accurate indication of subcontractor pay trends across the construction industry, publishing the average pay for a spectrum of 17 different trades split across 10 regions in England and Wales. We supply statistics to the Bank of England to keep policymakers updated with real-time in-sights on demand for skilled labour.