Construction wages rocket as labour shortages cause inflation

construction-stockSkilled construction labour shortages are pushing wages in the sector far above the national average, according the latest survey by the Royal Institution of Chartered Surveyors (RICS).

The RICS UK Construction Market Survey shows that 61 per cent of construction professionals throughout the UK have reported sharp wage rises in the sector. Average construction earnings have risen by more than 6 per cent in the year to October – a marked increase on the average UK wage rise over the same period of under 2 per cent.

Labour shortages were reported by 66 per cent of construction professionals to be the most significant barrier to growth in the last quarter of 2015. Quantity surveyors are reported to be in particularly short supply in Scotland, with 57 per cent of survey respondents having difficulty finding QS’.

Despite the shortage of skills, activity has remained firm in the Scottish construction market, with a net balance of 24 per cent of respondents reporting an increase in workloads. Private commercial and infrastructure workloads saw the most activity in the last quarter of 2015, with a net balance of 42 per cent and 29 per cent more chartered surveyors reporting a rise in workloads within these sectors.



Sarah Speirs, director RICS in Scotland, said: “While workloads are still growing at a relatively healthy pace throughout Scotland, labour shortages in the construction sector continue to impact and cause delays at different stages in the development process, leading to significant problems with project planning. More than 60 per cent of our survey respondents said that these resulting planning delays were an impediment to growth.

“That said, industry wages are becoming increasingly attractive, and I would hope that over time this will encourage skilled workers to return to the sector, as well as drawing school leavers and graduates towards construction industry careers.”

Industry growth looks set to continue, with a net balance of 59 per cent of respondents in Scotland predicting a rise in workloads over the next 12 months and a net balance of 41 per cent expecting employment within the sector to increase.

David Taylor FRICS, CBA QS, Glasgow, added: “There is certainly a confidence which was missing a few months ago, but it is fragile and dependent upon overall assessment of the economy. Staff shortages may become an issue as we continue to recover from this downturn which our industry has endured over the past few years.”


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