Construction site wages in the UK have risen for the fifth consecutive quarter, new data shows.

According to new data from BCIS/Hays Site Wage Cost Indices reveals construction site wages in the UK were up by 2.4 per cent in Q2 2024 compared to Q1 and 4.6 per cent on an annual basis.

The Building Cost Information Service (BCIS) works with Hays Recruitment to track movement in the cost of site labour in the construction industry. 

The indices were compiled by BCIS solutions architect Paul Burrows for BCIS and Hays.

Skilled mechanical and electrical trade placements saw the greatest annual growth earnings with pay 14.8 per cent higher than Q2 2023.

Elsewhere, unskilled and semi-skilled work saw a 8.2 per cent bump over Q2 2023, building trades skilled increased 5.1 per cent, while plant operatives represented no change.

Hays reported fewer construction job placements in Q2 2024, continuing a decrease which has been seen since 2Q 2021. 

Burrows said: “As the numbers of placements continue to fall across the board, whilst pay rises in line with wage agreements, it looks as though the market is suffering from a shortage of skilled workers.”

A report by CITB in May revealed that 251,000 extra construction workers are required by 2028 to meet demand, with 31 per cent of construction employers finding suitably skilled staff remaining the key challenge.

“This is likely to be exacerbated as workers leave the industry, especially with the retirement of older workers who aren’t being replaced.” 

Burrows notes the recent fall in construction output in Q2 as a mitigating factor against the effects of a shrinking workforce.

Latest ONS data shows construction output is estimated to have fallen by 0.1 per cent in Q2 compared to Q1, while total construction new orders in Q2 grew by 16.5 per cent (£1,771 million).

“New orders data though, which is a snapshot of potential future work, showed another significant increase in the second quarter, boosted mainly by private commercial and infrastructure new work. 

“If those orders translate into output, that may mark the point where skill shortages really start to constrain new activity, and I would expect to see upwards pressure on wages. 

“It will be interesting to see if numbers of placements start to rise towards the year-end and, if they do, whether increased demand pushes up wages.”

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Source: Construction Wave

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