The UK construction sector is showing signs of stagnation with new figures revealing that employment in the industry has barely grown over the past year and raising fresh concerns about the government’s ability to meet its housebuilding pledges.
Research from Inventory Base shows that the number of people employed across the construction industry rose by just 0.7% in the past 12 months, equivalent to just 2,615 roles.
Total industry employment stood at 380,200 in 2024, up 10.6% compared to five years ago, but the pace of growth has slowed dramatically.
While long-term gains have largely been fuelled by a doubling of employment in utility construction – such as electricity and telecommunications – recent hiring trends tell a less positive story for the core housebuilding sector.
NEGATIVE EMPLOYMENT GROWTH
Employment in the construction of residential and non-residential buildings has risen by 22.2% since 2019, but actually declined by 0.1% in the last year.
Other associated sub-sectors have also recorded flat or negative employment growth, including joinery installation (0.3%), painting and glazing (0%), and other building completion and finishing (-6.9%).
The slowdown casts further doubt over the government’s commitment to deliver 1.5 million homes during this Parliament – an annual requirement of around 370,000 homes. Without a significant increase in construction capacity, experts warn those targets are unlikely to be met.
MORE THAN HEADLINES
Sián Hemming-Metcalfe, operations director at Inventory Base, says: “The Chancellor has been promising bold action on housebuilding, but current employment data tells a more cautious and less optimistic story.
“Long-term growth exists, but in the past year the sector has stalled and even slipped in residential construction.
“Meeting housing targets takes more than headlines; it demands investment in skilled labour and practical support.”
INTERVENTION NEEDED
And she adds: “Without meaningful intervention, supply will keep falling behind demand, piling pressure not just on house building, but also on a rental market already strained by high demand and limited availability.
“More homes could start to ease that pressure, giving tenants more choice and tempering rents, but only if homes are accessible to renters and not just owner-occupiers.
“With the Autumn Budget only months away, it’s the Prime Minister’s chance to prove that he and the Chancellor truly are ‘in lockstep’ and prepared to deliver.”
The data will add to growing calls from the construction sector for greater support in training, labour supply and planning reform, as developers warn that skills shortages are becoming a critical bottleneck to growth.
