A report from The Federation of Master Builders (FMB) suggests that the outlook for small Scottish building firms is “significantly worse” than the rest of the UK. Its survey of members says that falling workloads and rising costs have forced many companies to reduce their operations in the first quarter. And Scottish firms were more negative about the future than those elsewhere in the UK, although they were a little less negative than they had been in the previous quarter.
Grahame Barn
Scottish Director, FMB
FMB director for Scotland, Grahame Barn, explained that all work was very price sensitive, especially for domestic repairs, maintenance and improvements. “To secure work our members are working on minimal margin – if any at all,” he said. This does not give them any confidence over the short to medium term. This in turn impacts upon employment and apprenticeship places.”
He called on the UK government urgently to review the 20% rate of VAT on those key markets, adding that it had become ” a charter for rogue builders and the informal economy is hampering legitimate businesses.”
Professor Donald Macrae
Bank of Scotland
However, not all of the economic news is bad. The latest Bank of Scotland Report on Jobs shows some growth in both permanent and temporary staff placements last month. The strongest rise was for permanent appointments, which more than reversed a reduction in February. Higher placements generally reflected greater demand for staff, but the rates of vacancy growth remained weaker than their respective long-run series averages. Meanwhile, permanent salaries increased in the latest survey period, following no change one month earlier.
Professor Donald MacRae, the bank’s Chief Economistsaid that the latest result showed “a welcome rise from the low of last month. The number of people appointed to both permanent and temporary jobs rose while the number of vacancies increased. These results reinforce the view that the Scottish economy is continuing its slow recovery from recession.”