In another sign of the ongoing major squeeze on available skilled labour, new data shows that in three areas of the UK, the average weekly wage of tradespeople has broken the £1000 barrier.
The demand for skilled workers will only rise further as all areas of construction struggle to recruit fast enough to meet demand, which puts power and influence in the hands of the current workforce. But ever-increasing wages only add further to inflation.
£1000 per week
This is not the first time in the last few years that average weekly wages have topped the £1000 barrier, but with three regions of the UK doing so at the same time, and demand for skilled workers only set to rise further, there is a chance that the £1000 per week becomes embedded and ends up being a new higher threshold for workers.
In data, provided by Hudson Contract, London, the South East and East Midlands all show that the average weekly pay for all tradespeople was above £1000. East Midlands was the region that topped out as the highest.
Reports have been rife for a while now of skilled bricklayers, plasterers etc commanding £1000 per week in wages. This data serves only to reinforce the anecdotal evidence we are being told on the ground all of the time.
We know well in the fenestration sector that there has long been a skills gap, and that there is a dwindling supply of skilled workers to facilitate growth in our market. The effect of this is to push wages up higher in a bid for companies to attract the right talent, whilst not being able to plug the gaps and bring in a big enough cohort of new young people to make up the chasm.
This is good news however for skilled workers, who are finding their talents in high demand, which puts them in a position of power and influence when it comes to wages. Very handy, considering the cost of living crisis and inflation that we’re all living through right now.
It does though feed into the inflation cycle. Companies who are putting their wages up to these levels will no doubt be passing those costs down to the end-users, which ultimately only serves to continue rising inflation. It’s a very difficult situation for many businesses to be in. They need skilled workers, but they’re picking from a limited field, and having to use higher pay as a method to bring them on board. But those higher costs have to be accounted for somewhere, which usually means higher prices being paid further down the supply chain.
Wages will head higher
If you’re a tradesperson, the good news is that there is no sign that wages will drop off at any point soon. All the ingredients are there to create an environment where wages are used as a USP to attract the right people to a business.
The Government has set itself a whole host of unattainable targets over the next decade. It wants 300,000 news homes per year. It wants to retrofit tens of millions of homes to reduce their carbon footprint. It has eyes on all sorts of infrastructure projects in many cities around the country. The one thing these all need, but that we don’t have even close enough of, is skilled workers.
There’s not a chance any of the long term construction-related targets will be met. We are short of hundreds of thousands of the right people. The Government will in all likelihood attempt some kind of fast-track training to usher people into those sectors, but it won’t be enough and it’s likely the training won’t be good enough either.
It means that the skilled workers currently in the economy are going to be even more sought-after, which again puts them in the front seat when it comes to setting pay arrangements.
The fenestration sector, just like other construction-related parts of the economy, is vastly short of the number of right people it ideally needs. What we are seeing now are the effects of policies set by various Governments over the past two to three decades, which have weighed very heavily on the side of academia, with trades and manual jobs shunned and derided.
If we are to see a turnaround in the current situation, it has to start at the education level. We need much more of the education sector to actively provide better opportunities to school leavers, showing that there are more routes to success and careers than just university. What is worth noting, is that it’s highly likely that there are more tradespeople working right now who have more money in the bank than those who went to university and got a degree!
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