A new survey has revealed nearly half of UK contractors cite a lack of skilled tradespeople as one of the main reasons why they cannot fill vacancies.

In Build UK's State of Trade survey for 2016, 47% of respondents said a lack of required skills made it difficult to fill posts, while 44% said another reason was a low number of applicants with the required experience. In addition, 27% stated a lack of qualifications prevented them from hiring workers.

Elsewhere, a quarter of contractors (25%) were prevented from bidding for work due to labour shortages, a rise of 16% from Q2. This was also reflected in the tightening of industry capacity, with 85% of contractors operating at over 75% of their capacity and 49% operating at over 90%.

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Over half of participants (55%) reported an increase in labour costs compared to the previous quarter, while 60% stated costs were higher than that of a year ago. Overall, the trades proving the most difficult for contractors to recruit are professional/technical staff and supervisors, brick layers and carpenters.

While the survey also revealed output increased modestly during the third quarter of the year, there was a decline in enquiries. However, workloads are expected to lighten in the final quarter of 2016, with output anticipated to increase over the next 12 months.

Build UK Chief Executive Suzannah Nichol MBE said: "While the industry demonstrated its resilience by continuing to grow during Q3, we can see that projects are increasingly affected by construction's skills challenges. By getting behind the recommendations of the Farmer Review and delivering on the industry's commitment at the Construction News Summit Skills Hack to reform the skills system, we can address these challenges and achieve change throughout the supply chain."

(LM/MH)