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Galliford chief warns of skills crisis

Galliford Try housebuilding chief Greg Locke has warned that the sector’s recovery could be hampered by the lack of young people being attracted to it.

Mr Locke, who joined Galliford Try last autumn as managing director for housing outside London and the South-east, believes the industry is not promoting itself well enough to school leavers.

He told Construction News: “On site I see an ageing workforce right across the board, from surveyors and engineers to carpenters and bricklayers.

“In the last recession, what bailed us out was the Eastern Bloc coming to the UK. We sucked in a lot of foreign labour from Poland and the Baltics and they have helped our industry no end.

“My personal concern is that a major challenge going forward is that lack of availability of people, so I fear that when the market eases we will see pressure on labour.”

The former Redrow, David Wilson and Bridgemere executive joined Galliford Try to help the company meet its three-year housing expansion plan, drawn up in 2009.

The company aims to build 3,000 units a year by 2012, and last week’s results for the second half of 2010 showed it was on track to achieve that target.

The group posted a 29 per cent increase in profits to £17 million on broadly flat turnover of £576m.

While the construction division reported revenue of £443m, down from £466m in the same period the prior year, housebuilding revenue soared 29 per cent to £153m.

Housing profits increased 39 per cent to £9.9m with completions up 28 per cent to 851 units.

Mr Locke said: “The results are in line with our plans and we think we have done well in a tough market. Conditions have been challenging but we have the land in place to do it.”

Galliford Try chief executive Greg Fitzgerald said although the group’s construction order book had fallen from £1.8bn to £1.75bn, it had not suffered as much as expected.

“I was very pessimistic about construction - 18 months ago I would have predicted the order book to have dropped to £1.5 billion and margins to have dropped as well.”

The order book for building fell by the biggest extent, down from £706m to £631m. Mr Fitzgerald said he believed it “had fallen broadly as far as it was going to”.

However, he said he saw no growth across the business as a whole before 2013.

He said the company was seeing strong growth in the water industry, with an order book of £470m - just more than half its total infrastructure order book.

The company added that it had secured 61 per cent of budgeted work for next year, up 1 per cent on the same point in 2009.

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