According to the latest State of Trade Survey by the Federation of Master Builders (FMB), rises in material and labour costs could seriously threaten the fragile recovery in the building industry.
The FMB survey of member firms shows the net balance for workloads, expected workloads and enquiries in the third quarter of 2013 was positive across almost all of the UK for the second consecutive quarter.
A marked improvement was seen in the private new build and residential repair and maintenance sectors, in particular, and overall 42% of small builders saw their workloads increase. However, material costs, wages and salaries are all expected to continue to increase over the next six months, which means that many building companies may have to put up their prices.
Chief executive of the FMB, Brian Berry, said: 'Britain's builders have endured some of the most testing economic conditions in living memory and the lean years have taken their toll. Construction SMEs have battled to maintain staffing and capacity while trying to keep prices competitive. Material costs have remained high throughout 2013, and further increases could snuff out this recovery in its infancy, especially if companies that have cut their profit margins to the bone to beat the recession are now forced to pass on those costs to their customers.'
