Forty-four percent of Master Builder companies have reported in the first three months of 2024 that their business is on track to make a loss or fall below expected margins, with an increase in material costs over the past quarter seeing sixty-five percent of members reporting that they have needed to increase prices, according to the latest State of Trade Survey from the Federation of Master Builders (FMB), for Q1 2024.
Gavin McGuire, Northern Ireland Director of the FMB, said: “It’s encouraging to see enquiries and workloads have risen slightly at the beginning of 2024 in Northern Ireland. It remains a challenge for firms to continue to see growth, and in real terms, margins have tightened. The concerns over rising overheads and costs means that for many, balancing work loads, client expectations, finances and maintaining a business takes a lot of time and resource."
McGuire concluded: “The SME builder sits at the heart of local communities in working on key projects that enhance the lives of those living there. With a recent Executive established at Stormont, FMB members have spoken of the need for stability to allow the houses and infrastructure we need to be delivered.”
The latest survey for Q1 2024 found:
Northern Irish Market Conditions
- Northern Ireland witnessed a substantial increase in overall workloads, rising from -17% in Q4 2023 to a positive 14% in this quarter.
- There has also been a significant rise in enquiries, with an from a net change of -17% to 29%, a very positive outcoming, indicating reason for optimism ahead.
The FMB State of Trade Survey for Q1 2024 found:
Market conditions
- There has been a very moderate increase in total workload and enquires, but number are still negative, reflecting the same metrics seen in 2010 to 2013 when the country was buffeted by austerity measures.
- Employment over Q1 of 2024 has remained stable and matches similar figures seen in 2010 to 2013.
- 44% of FMB members reported a decrease in enquiries.
- Workloads were up 6% on Q4 2023.
Skills
- Overall, difficulty in recruitment has slightly decreased, with the exception of general labourers who are more difficult to hire (28% struggled to hire them compared to 24% last quarter).
- 33% of members are struggling to hire carpenters.
- 28% are struggling to hire bricklayers, which has dropped considerably from 35% last quarter.
- Over a third of members report that jobs are delayed because they are struggling to hire skilled workers.
Changes in prices and costs
- 69% of members report that material costs increased in Q1 2024, up from 63% in Q4 2023.
- The impact of increased outgoings has led to 65% of members increasing the prices they charge, with 44% reporting that the business in on track to make a loss or fall below expected margins.
- Over a quarter report that they are restricting hiring new staff as a consequence of increased outgoings.
