Construction unemployment is still rising and undermining the UK's economic recovery. This is the stark conclusion from the latest State of Trade Survey from the Federation of Master Builders (FMB) which reveals that 29% of construction SMEs expect to cut more jobs over the next six months.

Richard Diment, Director-General of the FMB, said: "The SME construction sector has now been cutting employment levels for three and a half years. What is concerning is that our latest survey shows that we have still not hit the bottom, with a third of SME builders reporting that they had been forced to reduce employment levels over the last three months."

Mr Diment continued: "These job losses have damaging implications for the country's economic recovery and in particular the Government’s forthcoming Green Deal retrofit programme as this erosion of the construction skills base will lead to a serious shortage of suitably skilled tradesmen. Previous recessions show that once people leave the construction industry they tend not come back to it when the economy recovers meaning that their skills are lost to the industry on a permanent basis. Even conservative estimates suggest that we have already lost 125,000 skilled workers from the sector. Allowing the skills base to deteriorate in this way risks holding back the recovery by causing delays and driving up wage costs."

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The FMB believes 36% of firms are expected to see falling workloads over the next three months, and the picture is bleak for private new house building.

Mr Diment concluded: "The Government's new Construction Strategy which will be launched on 19thJuly is an opportunity for the Government to really focus on helping the construction sector. Without the Government's support for the building industry the fragile economic recovery will be seriously undermined and the skills base that will be required when we do finally move out of recession won’t be there to build the infrastructure and homes that this country will need."

(CD/KMcA)