Construction Labour Rates Surge 8.6% Despite Seasonal Slump

The construction sector has seen a substantial rise in labour rates with average earnings up by 8.6% compared to the previous year. As reported by Hudson Contract, a leading payroll service provider, January 2025 saw self-employed tradespeople earning an average of £985 per week. This marks a significant increase from the £907 recorded in January 2024.

Despite the annual growth, earnings in January showed a typical seasonal decline when compared to December 2024, dropping by 7.5%. Such fluctuations are common in the construction industry due to weather conditions and the holiday season affecting the availability of work.

Varied Impact Across Trades

The impact of the seasonal slowdown was not uniform across all trades. Surfacing contractors experienced the most significant reduction in earnings, with a 14.7% drop from December, followed closely by a 13.2% decrease in bricklaying work. The harsher winter weather conditions curtailed outdoor activities, disproportionately affecting these sectors.

Conversely, trades less reliant on favourable weather, such as equipment hire and plumbing, were less impacted, with decreases of only 2% and 3.8%, respectively. The flexibility of indoor work allowed plumbers to sustain more stable income levels throughout the inclement weather.

Market Demand and Labour Shortage

Ian Anfield, Managing Director at Hudson Contract, attributes the robust year-over-year growth to sustained demand and a persistent shortage of skilled workers. He notes that with tight household budgets, workers are eager to return to the job site rather than take prolonged breaks, adding to the workforce's resilience.

Furthermore, Anfield highlighted that contrary to some media narratives, the housing market continues to drive demand, with strategic project releases maintaining order book stability despite broader economic challenges.