Economic Week In Review | Issue 349 | 3 October 2022
Labour | Self-employed labour rates, according to Hudson Contract have reached a record high with average weekly pay above £1,000 in London, the South East and East of England.
Drones have been successfully used by Scottish Water to assess the condition of its infrastructure. The drones can replace teams of up to 15 people with just two operatives who do not need to enter into dangerous areas.
CLC plan | The Construction Leadership Council has released a new strategic plan which sets out priorities for the next three years. New additions include building safety and the “golden thread” of digital information in construction projects.
Materials, commodities and currencies
British Steel | The Chinese owner of British Steel – Jingye – has asked the government for a rescue package of hundreds of millions of pounds. The Government stated that it is “working at pace with the company to understand the best way forwards”. The company is reportedly losing £1 million a day and is looking for £400-500 million of support, of which £100 million is to offset the cost of carbon permits. Carbon is a current known pressure, in July, Tata Steel reported that it would need government support to invest in electric arc furnaces to help it decarbonise.
Sterling | The pound has recovered almost all the losses against the US Dollar that it saw following the UK’s mini-Budget but remains almost 9% lower over the past three months, its worst quarter since the 2008 crisis. News on Monday that the Government will retain the higher 45% rate of income tax boosted the pound
Timber playbook | The Alliance for Sustainable Building Products is to set out industry-accepted guidance for developers, investors and designers in order to smooth the process of insuring mass timber buildings. RIBA will act as a peer reviewer.
GDP | The UK’s GDP grew 0.2% in Q2. Whilst this means that the UK is not technically in recession, it does indicate that the UK is the only G7 country to have a smaller economy than it did in 2020.
Credit rating | S&P has put the UK’s credit rating on notice with a “negative outlook” as the agency has cited “additional risks” in lending to the country.
Strikes | After a brief pause during the national period of mourning, strikes are to resume across several key UK industries such as rail and post.
Bank of England | The Bank began a £65bn bond-buying scheme after pension funds were destabilised following the statement from the Chancellor on the UK Growth Plan.
Investment | MPs are pushing for an inquiry into pensions strategies which led to last week’s sell-off which encouraged the Bank of England into action. MPs will question the Pensions Regulator after thousands of pension plans were reportedly near collapse last week.
Housing | Despite being encouraged by the relaxation in Stamp Duty, the housing market is seeing new challenges as mortgage lenders recalled products from the market, replacing them with much higher interest rates, with some reaching 10%.
US stocks have seen their longest run of quarterly declines since the 2008 crisis as Banks seek to tackle inflation by increasing interest rates. The tech-based Nasdaq ended the quarter 5.3% lower, closing on Friday at its lowest closing level since June 2020.
Published every six months, our Tender Price Index is an analysis of inflation price deviation in construction prices. Click on the link above to view our most recent Index.
Friday to Friday
Price / Index
Week % change
Annual % change
$ per £
€ per £
Brent Oil $/barrel
The impacts of the UK’s Growth Plan and how it will be paid for were the focus of the week’s news, and undoubtedly, the recent reversal and questioning of key policies will continue to keep it in the headlines.
The associated unrest in the market has shaken some investors who wish to better understand how materials and buying power are impacted by currency volatility, with more being concerned about the dollar, which has a less obvious relationship with construction pricing but drives the affordability of commodities for UK buyers.
The new energy price cap comes into effect this month and will be offset by the Government’s energy schemes but the recent news from British Steel and Tata Steel shows that this temporary fix will not solve the problems and that investment in UK generated cleaner, less carbon and energy intensive systems and technologies is needed, but the current economic environment is not an enabler for this.
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