62 | MARCH 2022
Business
Read online at www . proinstaller . co . uk
Methodology :
Data : Survey of 250 self-employed tradespeople from across the UK , conducted September 2021
NINE IN 10 TRADESPEOPLE FORCED TO DELAY PROJECTS DUE TO ONGOING SUPPLIES SHORTAGE
Ongoing supplies shortage costing UK tradespeople over £ 3.5bn in lost earnings with the vast majority forced to delay projects or turn down work
Nine in 10 ( 87 %) tradespeople are being forced to delay projects due to the ongoing supplies shortage , a new report reveals .
The study by small business insurance provider Simply Business unveils the devastating impact of the supplies shortage , with over a quarter ( 27 %) of tradespeople saying they ’ ve had no choice but to delay projects by a minimum of four-eight weeks .
Nearly one in five ( 16 %) had had to delay projects by eight-12 weeks , and a further one in six ( 13 %) have had to delay projects by three months or more .
The supplies shortage , caused by a damaging combination of unprecedented demand , tighter restrictions on imports after Brexit , and rising costs of materials , has left tradespeople across the country facing a staggering £ 3.5bn loss . Costs are being passed down to the tradespeople and then ultimately the consumer .
Losing work and earnings
The report showed that tradespeople have lost an average of £ 5,598 each as a result of rising material costs and a drop in earnings from needing to turn down work . One in five have lost over £ 10,000 each .
Overall , 79 % of the UK ’ s 801,000 self-employed tradespeople are affected by the shortages , amounting to a staggering £ 3.5 billion loss of earnings .
What ’ s causing material shortages ?
As the UK recovers from Covid-19 , 34 % of tradespeople believe a post-pandemic surge in demand has been the top factor in driving the current material shortage .
A further third say the impact of Brexit on imports – with delayed border checks , tightened restrictions and trade barriers – is adding to the challenge . More than one in 10 ( 12 %) feel Covid-19 travel restrictions are also playing a part .
Alan Thomas , UK CEO at Simply Business , commented : “ The ongoing supplies shortage is having a significant impact on tradespeople in the UK at a crucial time in their recovery from the effects of the pandemic . With 79 % forced to turn down work in the last three months alone due to shortages , the total loss to self-employed tradespeople is expected to exceed over £ 3.5 billion .
“ This is a huge blow to the livelihoods and dreams of so many tradespeople across the country , but the ongoing situation should concern us all – small businesses are crucial to the UK , contributing trillions of pounds each year in turnover . A £ 3.5 billion hole in the books of self-employed tradespeople damages the wider economy , and it ’ s vital that they ’ re given the support they need to navigate this period of uncertainty .
“ Thankfully , we ’ ve seen remarkable resilience among the trades community throughout the pandemic , and it ’ s encouraging to see almost half of tradespeople remain optimistic about the future despite current challenges . Tradespeople will play a key role in the rebuilding of our economy and communities , and their resilience in the face of such challenges should give us all confidence that we ’ re on the right tracks to recovery .”
How did we calculate the £ 3.5 billion figure ?
The money lost was calculated between the increased cost of materials and the cost of having to turn down work .
• The weighted average of money lost due to increased costs , according to the SB survey , is £ 2,229.36
• The weighted average of money lost due to turning down work , according to the SB survey , is £ 3,368.66
• The weighted average of total money lost is £ 5,598.02
• The percentage of tradespeople affected by increased costs , according to the SB survey , is 86 %
• The percentage of tradespeople who had to turn down work , according to the SB survey , is 71 %
• The average percentage of tradespeople affected by both is 79 %
• There are ~ 801,000 tradespeople in the UK , according to ONS
• The number of tradespeople affected by both is ~ 628,785
• Therefore the total money lost by UK tradespeople due to supply shortages is ~£ 3,519,952,538.02
Weighted average money lost £ 5,598.02 Number of UK tradespeople 801,000 Tradespeople affected 628,785 Total money lost £ 3,519,952,538.02
About Simply Business
Simply Business is one of the UK ’ s biggest commercial insurance providers , specialising in public liability insurance for SMEs and insuring over 800,000 small businesses and landlords across Britain . Launched in 2005 , Simply Business has created an online brokerage service , delivering policies tailored to individual business requirements . Using the power of tech and data to create the best possible customer experiences , Simply Business employs over 700 people across offices in London , Northampton , and Boston in the US . Owing to its internal underwriting capability , Simply Business can cover over 1,000 trade types – ranging from plumbers to accountants to dog walkers . An accredited B Corp for their positive social impact , Simply Business has also been voted the Sunday Times Best Company To Work For twice in a row .