250 Carillion employees who worked at Nationwide branches will now join the building society’s payroll
- UK household spending hits pre-crisis levels
- Profit warning from estate agency Countrywide
- Stamp duty cut for first-time buyers hasn’t helped
Carillion’s collapse is a big blow to hundreds of apprentices employed by the firm, or by companies it contracted to help on construction projects.
Work has been suspended at several building sites, such as the Lincoln Eastern Bypass, creating, leaving workers in the lurch.
“Our industry, which has consistently reported skill shortages and difficulties in attracting apprentices, now needs to step up and support these young people who have so much to offer. There is certainly no shortage of work in construction, with housebuilding and infrastructure particularly strong, so these young people can have great careers despite this setback.
Nationwide’s decision means that most of the Carillion staff employed on private sector have some certainty over their future.
That’s because, as of yesterday, nine in ten of the private companies who employed Carillion to provide services had pledged to keep paying the Official Receiver – at least in the short term while the liquidation is carried out.
“It is welcome that 90% of Carillion’s private sector contractors have suggested that they will continue to pay staff. However, this is just for the interim period and due to the Government’s failure to think long-term, the future is still not certain for most workers.
“This concession has not been the result of any real Government intervention. Apart from meeting a few banks to find a quick fix to a long-term problem, the Government has failed to stop small businesses from going under.
The Green Party’s former leader, Natalie Bennett, says Nationwide’s decision shows that Carillion wasn’t actually providing much value.
So what was #Carillion actually contributing? Best answer would seem to be squeezing down pay and conditions of workers so it could take out profits for shareholders and #fatcat bosses. #productivity problem? https://t.co/fIaa41orsu
Here’s some early reaction to the news that Nationwide is taking on Carillion staff:
Statement from Nationwide just confirmed 250 Carillion employees will become Nationwide employees from Jan 22, saving their jobs. Nationwide also bringing a further 1000 outsourced jobs provided by Carillion, in house. Good news for jobs & well done Nationwide.
Makes you wonder what value Carillon was adding in the first place. https://t.co/1iRZtEpeIb
Nationwide to bring 250 Carillion staff in house, saving their jobs. A further 1500 subcontractors will now be contracted directly, via their employer, to Nationwide. Good news for jobs.
In a dramatic reversal of decades of outsourcing, Nationwide Building Society is going to in-source all the Carillion employees who were working for Nationwide.
“Our contractors perform a vital and valued role for the society. During an unsettling time for Carillion employees we felt it was important to provide them with some reassurances.
“We are today announcing a proposal to bring all services provided directly by Carillion in-house, with Carillion employees becoming Nationwide employees from 22 January. This will provide clarity for those affected and ensure that services are maintained.”
“As part of the wider supply chain arrangements we will also now look to deal directly with third-party suppliers that currently support the Carillion contract.”
Nationwide says it plans to bring all services provided by Carillion in house from Monday, transferring all employees to its own payroll.
The household spending survey also shows that Britons spent more on recreation and culture last year, mainly due to increased spending on package holidays.
That’s despite the fact that wages didn’t rise in line with earnings.
It’s surprising to see how many of us are spending on non-essential things like eating out and holidays. Families are still splashing the cash on package holidays and travel despite the fall in the pound after the Brexit vote.
If you’re starting to feel the pinch, now is the time to take a serious look at where you’re spending your money. Make a budget and stick to it, when you look back at bank statements you may be surprised how much you’re actually spending on non-essential items. Getting a hold on your fun money is key.”
The ONS have also produced this chart, showing where households spent their money last year:
Newsflash: UK household spending has finally returned to its levels before the financial crisis.
The Office for National Statistics reports that the average household spent £554.20 per week in 2017. In real terms (ie, adjusted for inflation) this is a return to pre-economic downturn levels.
ONS says UK family spending returned to pre-crisis levels for the first time in financial year ending March 2017. Avg weekly spending hit £554.20 – the last time it was above this level was 2005/06, at £557.
Transport is the biggest component of family spending, and increased by about £5 per week on a year ago, to about £80 a week on average. Buying new and used cars, the latter on hire purchase, was one of the reasons for the jump higher.
Economist Rupert Seggins has also been analysing the RICS housing report:
Latest RICS survey points to little house price growth in next few months. Wales , Scotland & N. Ireland most optimistic. London expectations the weakest by some margin. Respondents also reporting no observable impact as yet from the changes to stamp duty for first time buyers. pic.twitter.com/1yNzixBW2J
Ouch! Britain’s largest estate agency has issued an unexpected profits warning, sending its shares slumping.
Countrywide, which owns a string of estate agents around the UK, reported that revenues and profits both fell sharply last year.
Total income in the sales and lettings business for the full year is expected to be circa £360m, down 14% on 2016, reflecting a disappointing fourth quarter performance.
Income in the UK business is expected to be circa £205m, down 17% year on year, and in London is expected to be circa £155m, down 10% year on year.
Today’s report from the Royal Institution of Chartered Surveyors (RICS) also shows that fewer people have been making inquiries about buying a house.
Here’s City economist Sam Tombs of Pantheon on the RICS housing report:
The Chancellor’s reforms to stamp duty for first-time buyers have failed to stimulate demand so far. New buyer enquiries still falling rapidly in December, according to RICS, placing downward pressure on house prices: pic.twitter.com/QY1DXF6ZRd
Surveyors based in London are more optimistic about the stamp duty change.
RICS says that 28% believe abolishing the tax will help first-time buyers (compared to just 12% nationally).
In London, more than double the number of surveyors felt that it would have a beneficial impact on the market than those of outside London. Of course, this is reflective of the value of property in the Capital, where those purchasing for the first time can expect to save up to £5,000 under the new scheme.
Oldman-based surveyor Richard Powell of Ryder & Dutton says there’s no sign that abolishing stamp duty for first-time buyers has helped:
The stamp duty changes didn’t seem to have an immediate effect so we will have to see what happens in the early part of 2018. Stock levels are very low.
Usual seasonal downturn in enquiry levels, instructions and sales. Very little impact as a result of stamp duty changes but too soon to tell due to time of year.
[The market was] seasonally quiet and snowy weather also had an impact.
Stamp duty change for FTB’s so far has had little impact.
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, business and the eurozone.
“The initial feedback from the market doesn’t suggest that the change in the Stamp Duty regime announced in the budget is going to have a material impact on activity.
Indeed, the risk was always that a good portion of the benefit would be capitalised in the price, therefore limiting the benefit for the first-time buyer.
Whitbread: Premier Inn like-for-like revs miss (0.5% vs 1.5% est) but Restaurants beat and Costa not as weak as expected; On track for FY but expect tough UK high street environment and inflation to continue to pose challenges
Royal Mail says we sent more parcels (+6%) and fewer letters (-5%) last year. Overall its revenues rose 2%. Also reports that we sent 149m parcels in December. @BBCBreakfast pic.twitter.com/7vbGyjjiMR
Link : Nationwide building society to hire Carillion staff – business live