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Skills gap closes to best level since 1998

NEWS - Wage infl ation falls into line with other occupations and prospects look rosy

SKILLS shortages are at their lowest level for eight years, according to the latest construction survey by the Royal Institution of Chartered Surveyors.

A steady supply of workers from Eastern Europe is limiting wage inf lation, and skills shortages are down to their lowest level since 1998.

Only 28 per cent of firms quizzed reported problems finding workers ? down from a high of 46 per cent in late 2003.

Wage rises for skilled labour and construction professionals are falling into line with general wage inflation after several years of outstripping other occupations.

Walter Jonas of Newcastle based R H Duns said: 'Contractors are not experiencing problems recruiting skilled labour.

This may be related to the slowdown in the new housing market.' But, while finding workers is becoming easier, RICS members are finding it increasingly difficult to find contractors for tender lists as the growth in workloads accelerates for the second successive quarter.

Scotland and Wales were the fastestgrowing 'hotspots', followed by the North, the Midlands and East Anglia.

John Meechan of Gardiner & Theobald, Glasgow said: 'The availability of contractors prepared to tender has become a cause for concern, with many tenders being declined.' Paul Sherry of Atkins Faithful & Gould in Edinburgh said: 'There are continuing problems compiling tender lists of suitable or available contractors. Preliminary costs have soared to over 20 per cent on tender returns in the first quarter of this year.' Surveyors are bullish about prospects for the rest of the year.

RICS economist David Stubbs said: 'Gathering strength is evident in several areas of the industry.

'Continually rising commercial property values are spelling larger profits for developers, propelling a strong rise in workloads for the sector.

'With competitively priced overseas labour, the Olympic effect and the Government spending plans likely to bring a further boost, next year is looking rosy for many construction companies.

'Sharply increasing prices for materials such as steel and copper are the only potential blot on the landscape but the industry will continue to shrug these off while property values rise.'