housebuilder and construction firm Galliford Try yesterday said it planned to cut a further five per cent of its workforce in the construction business amid fears of government spending cuts and a continued decline in demand.
The company, which employs about 3,850 people, said it has cut as many as 15 per cent, or about 500 jobs, in the construction division from 3,300 last year.
“It’s a very challenging market in construction. There is undoubtedly less work out there... we are actually encouraging our construction division to downsize,” said chief executive Greg Fitzgerald.
Fitzgerald expects construction sales to fall seven per cent in the current fiscal, mainly due to the British government’s programme to slash public spending. “We would anticipate somewhere between 20 and 40 per cent cutbacks in most of our areas where the government spends money,” he said.
According to a survey of purchasing managers, growth in Britain’s construction sector slowed markedly in August, and employment within the sector decreased.
However, Fitzgerald expects sales from the its housebuilding unit, which the company planned to expand, and private commercial projects to offset the lower demand in construction.
For the year to 30 June, revenue was £1.22bn, down 16 per cent from a year ago. Galliford Try, whose landbank rose 24 per cent to 9,700 plots, expects to double its housing market sales in 2012 from £316m currently. Pre-tax profit rose to £26.1m from £24.5m last year.