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Published: 21/08/2024
BCIS works with Hays Recruitment to track movement in the cost of site labour in the construction industry by providing the Hays/BCIS Site Wage Cost Indices.
The indexes were launched at the beginning of 2020 and are based on market data provided by Hays, reflecting movement in the market for agency labour on a quarterly basis.
The Hays/BCIS Site Wage Cost Indices are more volatile and faster to react to changes in market conditions than the BCIS Labour Cost Index, which represents the movement in nationally agreed wage awards across the industry as a whole.
Construction pay up for fifth consecutive quarter
Construction site wages were up by an average of 2.4% in 2Q2024 compared with the previous quarter, and up by 4.6% on an annual basis, the latest data from the Hays/BCIS Site Wage Cost Indices shows.
| Skill Level | Percentage change 2Q2024 on: | |
| 1Q2024 | 2Q2023 | |
| All-in | +2.4% | +4.6% |
| Building Trades Skilled | +1.9% | +5.1% |
| Mechanical and Electrical Trades Skilled | +5.6% | +14.8% |
| Plant Operatives | 0.0% | 0.0% |
| Unskilled and Semi-skilled | +3.6% | +8.2% |
Source: BCIS, Hays
The greatest annual growth in earnings was seen in skilled mechanical and electrical trade placements, with pay 14.8% higher than in 2Q2023.
Source: BCIS, Hays
Hays also reported fewer construction job placements in 2Q2024, continuing a decrease which has been seen since 2Q2021.
BCIS Solutions Architect Paul Burrows, who compiles the indices for BCIS and Hays, said: ‘As the numbers of placements continue to fall across the board whilst pay rises in line with Wage Agreements, it looks as though the market is suffering from a shortage of skilled workers. This is likely to be exacerbated as workers leave the industry, especially with the retirement of older workers who aren’t being replaced.
‘Construction output fell again in 2Q2024, which has been a mitigating factor against the effects of a shrinking workforce. New orders data though, which is a snapshot of potential future work, showed another significant increase in the second quarter, up by 16.5% on 1Q2024, boosted mainly by private commercial and infrastructure new work.
‘If those orders translate into output, that may mark the point where skill shortages really start to constrain new activity, and I would expect to see upwards pressure on wages. It will be interesting to see if numbers of placements start to rise towards the year-end and, if they do, whether increased demand pushes up wages.’
The Hays/BCIS Site Wage Cost Indices are produced using market data from Hays Recruitment, generally representing labour requirements for immediate fulfilment. Because of this, the indexes tend to be more volatile and faster to react to changes in market conditions than other labour indices.
The BCIS Labour Cost Index, for example, incorporates the movement in nationally agreed wage awards, which are generally updated annually, across the industry.
Promulgated rates that took effect in June 2024 included a 4% increase for builders under the BATJIC scheme and 4.5% increases for builders and civils workers under the CIJC. Plumbers in Scotland and heating and ventilating workers are also due for increases later in the year
Source: BCIS, Hays, ONS
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