Rising construction material prices are now viewed as the single biggest threat to the industry, according to new survey findings from SafeSite Facilities. Of 500 respondents, 27% identified material costs as the primary risk to the continuity of their projects and businesses, rising to 38% among firms working in residential construction.
The research highlights a broad range of pressures bearing down on contractors and clients. Poor site safety standards were cited by 23% of respondents, while 22% pointed to environmental sustainability demands. Theft and vandalism, supply chain disruption, skills shortages and labour constraints linked to immigration policy all clustered closely behind, each mentioned by around one in five firms.
Climate change emerged as a critical underlying factor, described in the survey as the main “threat multiplier” rather than the top issue in its own right. Respondents also flagged delays caused by extreme weather and climate-related events, with 19% ranking these as a key concern, alongside regulatory complexity and red tape at the same level.
Jack Lowdell, manager at SafeSite Facilities, said the data shows a sector facing a “double threat” from escalating material costs and climate change. He noted that analysts expect building costs to rise by a further 15% over the next five years, warning that this will intensify the pressure on already stretched project budgets and margins.
Lowdell argued that the industry must prepare more systematically for adverse weather and its impact on site safety, while also improving environmental performance. By doing so, he suggested, contractors and clients can regain some control over the “clear and present dangers” that are set to shape project delivery in the coming years.
Dr Lowellyne James, HSEQ manager at SafeSite Facilities, said the survey findings mirror long-standing global research into systemic risks. He referenced KPMG’s 2012 “Expect the Unexpected” study, which identified climate change as the ultimate threat multiplier, exacerbating issues from supply chain disruption to rising material costs.
James warned that, despite climate-related challenges dominating the risk landscape, the sector has yet to fully prepare for their impact. He argued that sustainability must be treated as a core business strategy on a par with cost leadership or differentiation if the industry is to mitigate many of the risks it currently faces.
The full ranking of issues identified in the SafeSite Facilities survey is: rising material costs (27%), poor site safety standards (23%), environmental sustainability pressures (22%), theft and vandalism (21%), supply chain disruption (21%), skills shortage (20%), labour shortages due to immigration policy changes (20%), regulatory complexity and red tape (19%), delays due to weather and climate events (19%), lack of adoption of innovation and technology (18%) and mental health challenges (15%).
Separate research from the Federation of Master Builders (FMB) suggests that material and labour costs are already having a profound impact on homeowners, particularly in Northern Ireland. The FMB found that 15% of homeowners there have asked builders for a payment plan, compared with a UK average of 9%, while 11% have taken on a second job to pay for building or repair work.
Brian Berry, chief executive of the FMB, said it is “concerning” that so many Northern Irish homeowners are resorting to payment plans or extra work simply to keep their homes safe and watertight. He warned that basic home maintenance is becoming a “luxury” many cannot afford, with 37% of people in Northern Ireland reporting that they have never hired a builder at all.
Berry linked the situation to a wider cost-of-living “perfect storm”, in which rising material and labour prices collide with shrinking household budgets. He suggested this combination is not only suppressing demand for construction services but also increasing the risk of homes falling into disrepair, with implications for safety, health and long-term asset value.
