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The state of construction salaries.

An analysis of over 7,500 permanent placed construction jobs and current vacancies show that average pay in the construction sector has been on an upward trajectory over the last five years, increasing by 24% from 2016 to 2020. The largest increase was seen between 2018 and 2019 when average salaries rose by 8.5%, from £41,476 to £44,999.

Despite the economic uncertainty of 2020, average salaries in the construction industry have increased by £3,000, a 6.5% uptick, across a range of on-site and office-based roles. Salaries in the construction sector have been rising above annual inflation in the last two years.

A regional disparity in salaries.

While salaries rising is positive on an individual level, these figures cannot be viewed in isolation. The cost of living, house prices and rental prices all contribute to the amount of disposable income in workers’ pockets – and these have been rising alongside salaries.

Over the last five years, the average house price in England has increased by 16%, from £220,361 to £256,109. In London the increase has been smaller, at 7%, from £457,466 to £489,159, the 10% deposit required by most lenders is more than the average annual salary in the construction sector. In 2021 house price growth will be limited but is expected to rise by 4% in 2022 and 6.5% in 2023.

Salary differences between Britain’s regions are well-documented, but what is not often taken into consideration is job opportunities, the potential for sector growth and regional cost of living differences.

Our analysis shows that while London continues to provide workers with the highest average salaries in the industry at £50,630, monthly outgoings for either homeowners or renters are higher than elsewhere in the country, with average weekly livings costs of £651 and monthly outgoings of £2,885.

Given that take-home pay in London is on average £3,167, there is a limited financial safety net for workers in the capital. According to our research of over 2,000 candidates in the construction sector, 90% of respondents would like enough disposable income to save and cater for needs beyond essentials – which is perhaps a tall order for those in England’s capital, considering the weighty living costs attached.

Workers seeking a better balance between earnings and outgoings will find that jobs in the construction industry in the North East of England have been securing average salaries of £45,875 and with outgoings 50% lower than in the capital, workers will be significantly better off. 

The opportunity for hiring managers:

With the pull of equivalent salaries matched with lower regional living costs, companies can tap into the talent pool of workers across the UK, rather than restricting themselves to their local area.

The opportunity for candidates: 

Consider relocating to secure the best available job opportunities and a better balance between salary and outgoings. Talk to employers about a contribution to relocation costs.

76% of candidates would consider moving to another region of the UK if a company would contribute towards relocating costs.

Location, location, coastal location.

In 2020, COVID-19 transformed the working patterns of thousands of employees – and this is true across the construction sector. The industry’s office-based workers, such as architects, quantity surveyors and sales teams, have adapted to working from home, switching to predominantly virtual meetings. But for many the home work environment has been difficult.

According to research by the London School of Economics 46 per cent of people said they did not have a suitable place to work. As a result of prolonged periods of being at home, people are reconsidering their lifestyle priorities and living situations.

And we can see these changing priorities play out in real-time. Searches on Rightmove over summer for people looking for homes outside of London were up to 51%, a 9% increase on the year, while the number of home searches by people in Edinburgh, Birmingham, Liverpool, Sheffield, Glasgow and Bristol looking at properties outside of their cities also rose, as lockdown provided workers with a chance to reassess what really matters to them.

Is being close to the office a priority?

Working from home during lockdown has raised the attractiveness of rural locations away from cities, potentially with the ability to work from home in the future. 

Recent statistics showed commuting time as a primary factor in choosing a job with many opting for the shortest travelling time in job decisions. However, as we find ourselves in a new world of working from home by necessity, many are seeing it as an opportunity to reassess their living situation. Some businesses are closing offices and allowing full-time working from home. This saves expensive city rental prices and upkeep costs, and only time will tell on the efficiency of a working from home workforce.

63% of under 30s willing to relocate to a different region of the UK for a job without the added relocation incentive.