The governing has been asked to intervene amid the construction materials shortage which has left the construction sector on its knees.
Dwindling supplies of key building materials such as roof tiles, cement and a timber shortage have impacted the construction industry all year, and prices have soared across several materials.
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The shortage is expected to continue throughout the year at the very least, and prices could climb higher in the short-term - between July 2020 and July 2021 the cost of materials rose by 20%, according to the Office for National Statistics (ONS).
Now, the Federation of Master Builders (FMB) has called on the government to address the decline in construction, following the August IHS Markit/CIPS construction Purchasing Managers' Index (PMI), which revealed the lowest level activity of construction activity since February.
Brian Berry, chief executive of the FMB, said: “Disappointingly, we once again see construction output fall. I’m concerned that despite the high demand for home improvements, something which could stimulate economic recovery, we see this sector on the decline. We must pull together as an industry and press government to ensure these issues are dealt with quickly.”
If you're in the midst of a self build, renovating a house, or undertaking a home improvement project, read on to help plan ahead for your project, and learn which materials are facing price rises or shortages this summer.
Construction Materials Shortages Now a National Challenge
From a lack of lorry drivers to record high construction vacancies, it is feared that the materials shortage could begin to impact the UK economy.
Construction accounts for roughly 6% of the UK's economic output, and Andrew Goodwin, chief UK economist at Oxford Economics, a consultancy firm, says delays caused to homebuilding and home improvement projects could have a "knock-on effect on the recovery if construction companies aren’t completing projects quickly".
Mr Goodwin says the impact on the economy could become noticeable should homeowners be discouraged from improving their homes.
Haulage and the lack of availability of drivers remain major concerns affecting distribution of building materials, but the Department for Business, Energy and Industrial Strategy (BEIS) has rejected proposals from industry groups to issue temporary visas to EU drivers to alleviate driver shortages.
An emergency summit has been called by the Construction Alliance North East (CAN) in the North East for 1 October which will include the Builders Merchants Federation (BMF) to raise awareness of the deepening materials shortage crisis.
How the Construction Materials Shortage Could Affect You
Self builders
The materials shortages could come as blow to those working on self build projects who are building with steel or timber frame - materials which are both short in supply and have risen in cost.
Renovators
Renovators could also be affected by price increases. The cost of materials for repair and maintenance work rose 6.7% between June-July, and increased by 23% between July 2020 and July 2021, according to the BEIS Monthly Statistics of Building Materials and Components report for July.
DIYers
Building merchants are under increasing pressure, potentially leaving homeowners' DIY projects in doubt. The Construction Leadership Council (CLC) says that landscaping products and bagged cement are all in short supply.
SME builders
Brian Berry says some SME builders "are struggling to obtain the materials needed, and in some cases, small builders are actually saying they're concerned about the viability of their business."
Which Materials are Affected?
Timber
There has been a nationwide timber shortage since the first lockdown in March 2020, and imports remain an issue, against a backdrop of high demand for wood and wood products.
Steel
Steel is in high demand globally, and shortages could persist until the end of the year. British Steel recently stopped taking orders on structural steel sections due to “extreme demand”.
Roof tiles
Roughly half of National Federation of Roofing Contractors members reported a shortage of concrete roof tiles earlier this year. Lead times for concrete tiles are between 20-36 weeks, on average, while lead times for clay times are between 4-8 weeks.
Cement
Supplies of bagged cement have been strained since late last year, and Pal Chana, executive director of the Mineral Products Association, warned in July that supplies will not return to normal until the end of the year.
Electrical components
Certain electronic components, caused by a shortage of raw materials, could extend into next year.
Paints and sealants
Supplies to the UK are restricted due to a global shortage and cost of shipping containers.
Plaster and plasterboard
There was a severe plaster shortage earlier this year, and while supplies improved earlier this year, plasterboard has been subject to extended lead times, the CLC said in June.
There have also reportedly been shortages of:
- Concrete
- Insulation
- PIR insulation
- Bricks and blocks
- Kitchen carcassing
- Aggregates
- PE and PP plastics
- Screws
- Fixing
- Plumbing items
- Sanitaryware
- Shower enclosures
When Will Supplies Return to Normal?
Professor Noble Francis of the Construction Products Association (CPA) says "supply issues are likely to remain a problem for the next six to nine months at least".
Brian Berry echoes this view, and has warned of "significant material shortages for at least the duration of 2021.”
Will Building Materials Prices go Down in 2021?
Prices have increased due to lengthening lead times and increasing demand, which is making it difficult for manufacturers and suppliers to build up stock levels.
Prices soared by 20.1% in July for all construction work, compared to this time last year, according to BEIS, and prices increased 4.5% for all work in July compared to June.
Jewson said this month that its prices for materials including timber, wheelbarrows, insulation and adhesives will rise by as much as a fifth. Travis Perkins announced price rises earlier this year.
And the FMB's latest State of Trade Survey revealed that 98% of its members are experiencing price rises. This is expected to continue into late-2021.
These are some of the materials which have been affected:
| Material | Information | |
|---|---|---|
| Timber | Timber prices are at their highest level over the last 13 years, according to the Timber Trade Federation | |
| Steel | Fabricated structural steel prices jumped 53.3% in the year to June, according to BEIS. | |
| Cement | Cement prices have risen as much as 30%, as reported by The Telegraph. In June, Travis Perkins said the price of bagged cement will rise by 15%. | |
| Paint | The costs of paints and varnishes are up by nearly a third, according to the Construction Products Association. | |
| Chipboard | Chipboard costs went up by 10% in May, Travis Perkins confirmed |
However in the US, lumber prices fell as much as 6% earlier in June, according to Bloomberg, despite rising over 175% in the past year.
And the CLC has said that although product and material price inflation has slowed, indications are that it will be 2022 before prices stabilise.
Why is There a Shortage of Building Materials?
The construction materials shortage can in part be traced back to increased building and home improvement activity in 2020, particularly during the first lockdown. This led to a slowdown in the production of materials from some factories in the EU, and supply chains have remained stretched ever since.
But while construction output reached a 24-year high in June, demand is not being met by supply, and suppliers' delivery times have lengthened.
Lack of lorry drivers
The shortage is being starkly impacted by a lack of lorry drivers, the CLC warned in August - a problem which has also been attributed to food shortages in some supermarkets.
There is now a shortage of more than 100,000 drivers in the UK, out of a pre-pandemic total of about 600,000, according to a survey of Road Haulage Association member estimates.
Some suppliers have reportedly asking builders' merchants to collect their orders as they cannot get enough drivers to complete deliveries. One solution proposed by the FMB has been to put HGV drivers on the shortage occupation list to ease the backlogs in distribution.
Labour challenges
Labour rates have skyrocketed in some areas, due to a combination of demand outstripping labour supply, and some trades putting up their rates due to being overwhelmed with work.
Builder Andy Stevens from Eclipse Property Consultants says: "Labour rates have gone through the roof in some areas, all driven by market factors. Firstly, a number of Eastern European workers went back to their respective countries as a result of Brexit; this has hit the south east in particular."
The demand for construction workers is now close to 20-year high, according to the Office for National Statistics (ONS), with employment in the construction sector falling from 2.3m in 2017 to 2.1m at the end of 2020. This represents a 4% fall in UK-born workers and a 42% fall in EU workers.
Jobs website Indeed says construction has seen the highest growth in average advertised salaries since July, while Noble Francis expects 500,000 UK-born workers to leave the industry in the next 10 years as a demographic “bulge” of 50 to 65-year-olds retires.
Brexit uncertainty
Knock-on effects from Brexit remain, with roughly 60% of imported materials used in UK construction projects comes from the EU, according to the CLC. And despite this year's UK-EU trade deal easing Brexit construction, Brexit has lengthened the supply lines for a number of core supplies from Europe.
The Timber Trade Federation (TTF) said in May that Brexit-related complications have squeezed UK timber stocks, as 80% of the softwood used in building comes from Europe, and 90% of the softwood used for new build homes comes from the continent.
Noble Francis adds that January's new immigration system has made it harder to tempt EU workers back who left during the pandemic. “The small builders and specialist contractors are likely to be the worst affected by this as they are the least likely to have the resources available,” Francis said.
Raw materials
There is currently a global shortage of raw material shortages, stemming from global demand and other external factors (including the slowdown and in some instances, factory closures, outside the UK), which continues to constrain production of certain products, such as insulation, paints and adhesives, as well as packaging for products.
How to Navigate Shortages
If you’re planning or in the middle of building work, then planning as far as you can in advance is pivotal to ensure you aren’t caught out by shortages or price rises.
The CLC advises self builders to work closely with their supply chain and communicate your requirements early with suppliers, distributors and builders merchants.
And Brian Berry says: “Product availability is proving to be a significant and prolonged issue for Britain’s builders, and consumers need to be aware that the cost of their building projects may change in the months ahead because of this pressure.
“However, I would caution against homeowners compromising quality and customer service, and defaulting to hire the builder with the cheapest quote.”
You can also use services such as Environmate to discover free and cheap building materials for your project.
