The impact of the cost of living crisis on the construction industry

The impact of the cost of living crisis is becoming more apparent for both individuals and businesses across the UK, particularly with the energy price hike on 1st October.

But how has the construction industry dealt with the crisis so far? And what lies next?

The biggest concern originally surrounded the price of materials, however Construction News have reported that construction material price inflation fell for the second month in a row, following a 17.8% hike during August.

This definitely acts as a relief for the industry, who have already seen price increases throughout the year not only due to this crisis, but also the aftermath of the pandemic and conflict in Ukraine.

Some issues remain to be resolved though, as overall this year material price has increased by almost 25%, and this has been a problem particularly for construction companies keeping up with soaring prices whilst also being on fixed price contracts.

The construction industry has therefore urged new Prime Minister Liz Truss to offer extra support to the sector. Upon starting her new role, Truss laid out some of the construction policies she hoped to implement, however more clarity is being asked from the government, especially in regard to helping construction businesses with energy bills. 

In order to navigate the crisis, many construction companies are using the opportunity to invest in green skills, which will make them more appealing for future projects and in time save money. This has also aided preparations for the net zero by 2050 goal. 

Connecting with the workforce is also crucial at this time, ensuring workers have somewhere to go to speak about their mental health, and also providing opportunities to upskill and continue learning on the job. 

Although it is a difficult time across the industry, we hope that the positive news outweighs the struggles being experienced, and there is a road to recovery laid out for construction.