Latest payroll data from Hudson Contract shows that average earnings on London construction sites increased by 4.5% during May to 拢885 per week.
Hudson Contract supplies more than 2,500 companies across England and Wales with site workers on its books. Managing director Ian Anfield said that wage inflation in the capital was down to a reduction in migrant EU labour.
鈥淲e are starting to see the impact of people leaving the UK ahead of the EU settlement scheme deadline on 30th June and not being replaced by incomers,鈥� he said. 鈥淔irst and foremost, this is affecting London which has the highest concentration of foreign construction workers and the most transient labour market.
鈥淭he Brexit effect on labour supply is slower the further away you go from the capital and many EU workers have settled in the north of England. In central London, the prime housing market is growing for the first time since the start of the pandemic, a sure sign of the high spirits felt across the entire sector.鈥�
The West Midlands also saw a significant rise in weekly earnings for subcontractors, increasing by 3.5% to 拢920 during May. The region tends to have a larger supply of local tradespeople who have traditionally commanded higher earnings.
The cost increase mirrors an acute shortage of building materials in the West Midlands as a result of significant house-building activity and major infrastructure projects in Birmingham including new stations for high-speed rail and facilities for the Commonwealth Games in 2022.
Ian Anfield added: 鈥淭here is shedloads of construction work about and growing pressure on the availability of both labour and materials. We expect some respite for construction companies with the closure of the government鈥檚 self-employment income support scheme in September which should encourage claimants back onto sites.鈥�
| Region | May 2021 Average | Month on Month % Change | Year on Year % Change |
|---|---|---|---|
| North East | 拢671 | -8.6% | -7.8% |
| North West | 拢827 | -4.1% | 4.0% |
| Yorkshire and the Humber | 拢821 | 0.5% | 9.0% |
| East Midlands | 拢954 | 1.7% | 17.2% |
| West Midlands | 拢920 | 3.5% | 1.4% |
| Wales | 拢887 | 2.8% | 8.7% |
| East of England | 拢949 | -0.3% | 8.3% |
| London | 拢885 | 4.5% | 2.8% |
| South East | 拢923 | 0.7% | 5.4% |
| South West | 拢863 | 1.9% | 10.1% |
Last month, mechanical & electrical tradespeople saw the strongest growth in earnings, up 5.7% per cent to 拢1,068 per week. They were followed by joinery and plumbing contractors, whose earnings increased by 4.5% to 拢1,011 and 拢967 respectively.
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