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PRIVACY
Economic Development

Why Covid-19 has left thousands of Welsh construction firms in crisis

Small and medium construction companies have made the highest number of applications for Welsh Government support

Construction sector made the most applications to the Economic Resilience Fund(Image: Ian Cooper/North Wales Live)

When people consider the sectors in greatest crisis due to the coronavirus pandemic, the most obvious casualties have been in tourism, hospitality and aviation - industries literally brought to a standstill by lockdown.

But figures released by the Welsh Government have shown that firms in the construction sector have made the most applications for emergency support from the Economic Resilience Fund - with more than a quarter of the 10,000 requests of support.

The applications - mainly from SMEs - total around £40m and show the impact the crisis has had, with building sites either closed or operations curtailed.

With concerns that social distancing could now be with us for the foreseeable future, there are fears about the viability of some contracts given the often tight margins and tough deadlines.

Owain Williams, from Williams Homes(Bala), said: “As an industry the construction sector is used to dealing with risks.

“However the problems we are currently facing is that with the increase in management costs needed to make sure we adhere to Covid-19 rules are making it impossible to make money on sites.

Sion and Owain Williams of Williams Homes on site in Bala

"These sites were priced at pre-Covid rates, not only are management costs higher but we are finding that sites have approximately 50% less operatives on them which will make deadlines impossible to hit and will cause liquidated damages to be leveraged against the contractor.”

They said their own clients had been understanding but feared for other builders.