Bricklayers' pay has surged 20% in the past six months as housebuilders struggle to keep up with a surge in demand for homes driven by the Government’s Help to Buy scheme, an industry boss said today.
Galliford Try chief executive Greg Fitzgerald said good bricklayers can currently command salaries of £40,000 a year — or even more in the capital — as the industry scrambles for staff.
Fitzgerald, whose company reported record pre-tax profits of £74.1 million for the year to June 30, said: “I have evidence of us paying brickies 20% more than six to nine months ago.”
He added: “Pretty much, since Help to Buy on April 1, we have gone from an environment where if you made a mistake on a job and needed twice as many brickies you would just go and pick them up to a completely different ball game. We can see build inflation starting to come through for the first time in four or five years.”
Housebuilders are struggling “to go from A to B quite quickly” after a long recession which has seen thousands of staff drop out of the sector and lower apprenticeship numbers. The industry is also finding it difficult to source materials such as bricks and breeze blocks. “There is an element of panicking going on whereby some builders are ordering more than they need.” Construction markets have also improved but there has been no “shot in the arm” seen by the housebuilding world, Fitzgerald added.
Fellow housebuilder Crest Nicholson also saw signs of pressure on its supply chain as it reported forward sales of £145 million — up 92% on the £75m achieved this time last year.
Chief executive Stephen Stone said: “When we were looking at an IPO a year ago we never anticipated the Government would stimulate the housing market in the way it has done. Rather than taking a year or two years to get a slight improvement, there has been an almost instantaneous pick-up.”
Stone said the builder had been forced to look abroad to source breeze blocks as the UK’s three biggest suppliers struggle to keep up. But he added that the recent price rises were a “blip” which should start to level out in the months ahead.
Official figures showed big rises in orders for both public and private new housing between April and June, which rose at their fastest pace since the autumn of 2010. In volume terms, the £4 billion of orders is the highest since the end of 2007, according to the Office for National Statistics