Housebuilding Slump Continues

The downturn in the housebuilding sector continues, with bad news this week from Kier, Bellway Homes, Taylor Wimpey, McCarthy & Stone, Crest Nicholson and Wolseley.

Kier has closed two offices in its housing division as a result of the economic downturn. The closures, in Lincoln and Spalding, were necessary given the current market conditions. A total of 90 staff work in the two offices, which represents a fifth of its housing employees.

Bellway Homes has made 370 employees redundant, bringing the number of job losses in the housing sector over the past weeks to almost 1,000 as the credit crunch worsens. The Newcastle upon Tyne firm cut 15% of its 2,476 workforce shortly after Taylor Wimpey announced that it was closing 13 regional offices, making 600 redundant.

Earlier this month, McCarthy & Stone and Crest Nicholson, which are each co-owned by HBOS and Scottish entrepreneur Sir Tom Hunter, cut 10% of their staff.

Other housebuilders have played down the need for cuts. Mike Farley, chief executive of Persimmon, said his firm had lost only 'tens of people’ this year. Mark Clare, Barratt's chief executive, said the company had scaled back its use of subcontractors but that it didn't need to make internal cuts.

Meanwhile, building materials giant Wolseley has announced that it needs to 'cut overheads' in Europe and the UK after announcing 250 job cuts in the US and 30% profits fall.