Skills shortages and soaring costs plague Welsh builders

​​​​​​​Overall workloads in Wales increased in the first half of 2025, with house building and repair, maintenance and improvement leading growth

Wales’ construction industry is showing signs of recovery in the first half of 2025, with workloads, enquiries, and employment on the rise, according to the latest State of Trade Survey from the Federation of Master Builders (FMB) and the Chartered Institute of Building (CIOB).

However, rising costs and persistent skills shortages mean homeowners may still face higher prices, longer delays, and, in some cases, cancelled projects.

Overall workloads in Wales increased in the first half of 2025, with house building and repair, maintenance and improvement leading growth.

As much as 53% of builders reported higher workloads compared to the end of 2024, and 56% reported increased enquiries. Demand is robust for home improvement and significant works, while house building starts remain steady across smaller firms.

However, ongoing recruitment challenges and spiralling costs are putting pressure on SMEs, which make up the backbone of Wales’ construction sector.

Skills shortages bite hard

• 76% of firms said the lack of skilled tradespeople affected their work, leading to job delays (44%) and cancellations (38%).
• The hardest trades to recruit were roofers (47%), general labourers (47%) and bricklayers (47%), followed by plumbers/HVAC trades (35%), carpenters/joiners (32%) and plasterers (32%).
• Specialist skills are also in short supply: 82% of firms struggled to hire workers with knowledge of the new building safety regime, 74% with sustainable building practices, and 74% with new technologies.

Rising costs squeeze small builders

• 87% of firms reported rising material costs, the highest across the UK home nations.
• Wages increased for 72%, while 59% raised the prices they charge to keep pace with costs.
• The impacts of cost pressures are stark: 55% reported reduced profits or losses, 41% restricted recruitment, and 31% said their business viability was at risk.
• Looking ahead to Q3, most firms expect prices, wages and material costs to keep rising, with net increases of +65% to +71%.

Delays and late payments compound the pressure

• Half of firms (50%) said projects were delayed due to changing project parameters, while 44% cited planning delays.
• Market uncertainty (29%) and material shortages (26%) were common causes.
• Payments remain challenging: only 38% of Welsh builders said invoices are paid within agreed terms, while 18% reported invoices are often paid late.

Despite these pressures, Welsh builders remain cautiously optimistic: 65% have a positive outlook for the next two quarters, compared with 6% who are negative and 6% uncertain.