In the next 10 years 11,400 jobs will be lost in the construction sector as a result of today’s rise in the rate of VAT rise to 20% according to the federation of Master Builders.
A further 34,000 jobs could be lost from the UK economy as a whole by 2019, with homeowners becoming more vulnerable to rogue traders likely to flood the market.
Brian Berry, FMB director of external affairs said: “Construction has been badly affected during this recession so the VAT rise could not come at a worse time. The VAT increase will result in a 2% decrease in demand for domestic repair, maintenance and improvement work which will mean 11,400 job losses in construction alone by 2019. This will seriously affect the recovery of the construction industry, when it comes, as there won’t be enough skilled workers available.”
He continued: “The Government claims it wants to create a greener Britain but its decision to increase VAT will have the exact opposite effect. The job losses the VAT rise will create will mean that there will be even fewer skilled workers to do the energy efficient work required by the Government’s Green Deal.
“The simple solution is to reduce the rate of VAT on home repairs as this offers the best hope of encouraging take up of the Government’s Green Deal as well as helping to create jobs in the construction sector.”