A third of SMEs will cut jobs in next three months

A third of small to medium-sized builders expect to make redundancies in the first quarter of 2010, a survey has revealed.

The Federation of Master Builders’ State of Trade survey revealed that 38% of its members made staffing cuts in the final quarter of 2009, and 33% expected to make cuts in the first three months of 2010.

Richard Diment, the FMB’s director general, said: “The employment figures from our members’ survey are alarming as even after seven consecutive quarters of lay-offs, 38% of FMB firms reported that they had cut staffing levels.

“Even more alarming is the fact that 33% of FMB firms expect to have to make staff cuts in the first three months of this year.”

The survey also revealed that 44% of respondents expected workloads to decline over the first quarter of 2010, while only 18% expected a rise. The results prompted the FMB to forecast a ninth consecutive quarter of deterioration and that sustained recovery was a “long way off”.

One of the survey’s surprises was the pessimism of firms involved in new social housing, which predicted that workloads would fall in the coming quarter despite work having started on several housing projects under the Homes and Communities Agency’s Kickstart programme.

A similar sentiment was felt in the private R&M sector, owing to low consumer confidence. The FMB predicted it would be “some time before consumer spending on large home improvement projects picked up significantly”.

Diment warned that public sector cuts, which are expected after the general election, would “cripple an already badly damaged skills base and supply chain, and seriously inhibit the building industry’s recovery”.

The State of Trade survey comprises the responses of about 400 FMB members.