Labour rate rises show strong demand for skilled subbies

Demand for highly skilled self-employed labour stayed high last month despite the widely-reported slowdown in housebuilding activity, according to Hudson Contract.

Analysis of the construction industry’s biggest payroll shows that average earnings rose by 3.8 per cent to £982 per week during June. This was 6.6 per cent higher than the same period last year.

Industry surveys suggest that higher borrowing costs have caused the steepest drop in residential work since 2009, outside of the pandemic years.

Ian Anfield, managing director of Hudson Contract, said: “Some of our housebuilding clients are diversifying into commercial builds, social housing and build-to-rent schemes but that is not sustainable in the longer term. Britain needs a buoyant private housing market alongside an acceleration in social housing schemes. Given there is huge demand for housing, we should have government policy that makes building houses attractive and profitable for developers and affordable for consumers.”

Housing Secretary Michael Gove this week announced a package of reforms to encourage building on underused sites in high-demand regions, including new permitted development rights to create more homes in “the hearts of our cities” by converting existing buildings.

Mr Anfield said: “We welcome some of the sentiment but the huge property portfolio businesses are already engaged in repurposing the empty department stores which blight many town centres.

“The economics of repurposing brownfield sites are becoming more feasible with the inflated costs of new build and planning constraints blocking greenfield sites. We see this reflected in demand for demolition and wrecking contractors who enjoyed the strongest earnings growth last month – an increase of 11.1 per cent to £995 per week. We also expect remediation, groundworks and heavy civils firms to benefit.

“As more shopping and working moves online, city centres have been left with big empty units, so it is great to see former M&S, Debenhams and John Lewis stores being converted in places like Manchester, Stockport and Sheffield.

“The use of compulsory purchase powers to obtain more of these empty buildings for housing is a standout from the latest policy announcement, but the landowners have good lawyers so it may come to naught.

“The worry is that Gove’s plans are just lip service to the construction sector, with his real audience being his backbench MPs who wish to block greenfield new build sites in their bid to be reelected.”

Meanwhile, our latest pay trends analysis shows that weekly earnings in Wales hit record highs for the second successive month, rising by 0.2 per cent to £993. The North East saw the strongest growth, rising by 9.1 per cent to £804.

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. Our statistics are supplied to the Bank of England to keep policymakers updated with real-time insights on demand for skilled labour.