Tough times for the brick industry

Clay Technology magazine
,
16 Oct 2008

The housing crunch and international banking crisis have had a devastating effect on the UK brick industry, which has seen plants close, production reduced, and companies go into administration.

In its autumn forecasts, published on 2 October, the UK’s Construction Products Association (CPA) predicted that new starts in private housing in 2008 will be ‘the smallest figure since the Second World War’, with a 39% drop on 2007. Next year will see a further 14% decrease, meaning only 95,000 new builds will begin – in 2004, over 200,000 were started.

Manufacturers expect brick production to fall below two billion in 2008 - the largest drop in 60 years. Examples of the effect this has had on UK industry include:

The proposal to close Accrington Brick by owner Hanson Building Products by November. This will result in 80 job losses. Accrington made the Nori brick that was used in the Empire State Building’s foundation in New York, USA.

A further proposed closure by Hanson of its Swillington factory, and reduced shifts at the Saxon, Kirton and Howley Park sites. This will lead to 156 job losses.

Ninety-eight redundancies have been made at Wienerberger’s Eldon and Hartlebury/Waresley sites.

Potential closures at Ibstock’s Roughdales and Funton sites, and temporary closure of its Ellistown facility. This will put 136 employees out of work.

Closure of Southern Brick and Tile Company’s five production sites when the company went into administration in August. Two of its sites have subsequently been sold to Rayner Homes, based in Bournemouth.

The layoffs will continue,’ says Alan Baxter, Chairman of the Brick Development Association. ‘Most of the [brick factories’] capacity will be taken out in the next 12 months, and over half of next year’s products will be [leftover] stock from this year.’

For construction companies that remain in operation, some have been kept busy with repair and maintenance. Work in this area has been up six per cent in the second quarter of 2008 compared to the same time last year, according to the UK Office for National Statistics.

Michael Ankers, Chief Executive of the CPA, says there is hope the housing market will pick up again in 2010. ‘There’s a current issue with liquidity and a lack of confidence in the economy. But longer term, there is still a housing shortage, so we will have to start building accommodation for people in larger numbers than we will be doing over the next year.’