(last updated July 2019)
What has been happening in the plumbing and heating industry?
Demand for all types of construction services grew during the late 1990s and the first half of the 2000s as the economy prospered and the housing market boomed. However, better conditions prompted more people to start plumbing businesses, making for a very competitive market. It seems that newspaper articles about "£100,000 a year plumbers" encouraged large numbers of people - including some eastern European migrants - to enter the trade, not all of whom were actually able to find a job.
Unfortunately, the housing market boom came to an abrupt end in 2008 as the economy weakened. This caused an inevitable downturn in demand for plumbing services. The housing market and the economy remained weak during the closing years of the 2000s and into the early 2010s. Although there was still work available for good quality reputable plumbers - particularly those qualified to work on renewables like solar panels - trades-people had to make more effort than ever to make sure that their existing customers stayed loyal - and that potential new customers chose their business. Things began to improve during 2013, and 2014 was a much better year.
The economic recovery continued strongly into the first half of 2015 because of wages going up, low interest rates, falling oil prices and people's confidence in their employment prospects. However the recovery slowed towards the end of the year and slowed further throughout 2016 and 2017. Growth in the construction industry was subdued during 2016 and 2017. Little change is expected for 2018 - the Construction Products Association forecast that the sector would remain flat, at best, during 2018. New private industrial orders have been falling and growth has been dependent on an increase in infrastructure activity and private housebuilding offsetting a sharp fall in the commercial and industrial sectors. This pattern is expected to continue in 2018.
The loss of jobs in the industry following the financial crisis led to a skills shortage. Some 300,000 skilled craftsmen left the industry, many for good. This led to higher potential earnings for construction industry workers. The skills shortage has continued to cause problems and is expected to worsen as a result of Brexit and the reduction of European migrants to make up the shortage. Plumbers are in great demand, with an inevitable increase in wages that this brings with it.
Even during the recession and the economic uncertainty following the Brexit vote, the construction industry benefited from:
- many homeowners extending their homes because of the cost of moving up to a larger property, particularly in areas where prices are high, for example in London
- the increase in buy-to-let landlords creating a spike in demand for renovations - although recent tax changes have made buy-to-let less attractive so there may be a reduction in this work in future
Materials prices saw some sharp rises during the late 2000s and early 2010s, particularly metals like copper. Fuel prices soared too, making it more and more costly for trades-people like plumbers to run their business vehicles. Fortunately the mid 2010s saw fuel and other prices ease back. The cost of imported materials increased due to the fall in the value of the pound following the Brexit vote. The cost of materials is expected to continue to increase throughout 2018 and beyond.
Increased wages, the increased cost of materials, financial constraints and inflation generally mean that margins are under pressure. In such a competitive market it is very important for plumbing firms to run their businesses professionally and efficiently - and to offer customers excellent service and value for money.
Although it's still a male dominated trade, more and more women are training as plumbers in an attempt to challenge the stereotypical image of the industry.
In 2014 the Health and Safety Executive issued new guidance on legionnaires disease, making it clear that people in charge of premises - including residential landlords - have certain legal responsibilities. This gave rise to demand for risk assessment services from landlords.
Quality standards
For many years, trades like the plumbing industry have been plagued by unqualified and unscrupulous 'cowboys'. Much has been done to rid the industry of these cowboys and improve standards. For example, any person who services and installs gas appliances is required by law to be appropriately qualified and certified as competent by the Gas Safe Register, the UK-wide competent person scheme for domestic gas installers.
The Water Industry Approved Plumbers Scheme was launched in 1999 to encourage professional plumbers to work alongside their local water company in complying fully with the requirements of the Water Supply Regulations. More information is available on the Water Regulations Advisory Scheme (WRAS) website.
Various other approved competent person schemes have also been set up to help trades-people to comply with Building Regulations. Relevant schemes now include:
- oil fired and solid fuel combustion appliances (including biomass and biofuels)
- plumbing, water supply, heating and hot water systems
- ventilation and air conditioning systems
- sanitary conveniences and bathroom facilities
- microgeneration and renewable technologies such as ground-source heat pumps
- electrical safety - including 'defined competence' schemes for plumbers who install and work on electrical heating controls
The schemes make provision for installers of renewable energy technologies like solar water heating and ground-source heat pumps.
The Engineering Services SKILLcard is a voluntary registration scheme for workers in industries like plumbing and heating engineering. The SKILLcard scheme enables workers to demonstrate that they are competent and suitably qualified.
Customers are now better informed too - many know to look for the right qualifications and quality assurances when engaging a plumber.
Energy saving and renewable technologies
Rising fuel prices, government incentives and concerns about carbon emissions and the environment boosted demand for energy saving technologies and low carbon renewable heat sources during the 2000s and 2010s. Suitably trained and qualified plumbers were able to benefit from this trend by installing systems like high-efficiency boilers, solar water heating and ground-source heat pumps.
During the early 2010s payments were made available to householders under phase two of the government-funded Renewable Heat Premium Payment scheme to help them meet the cost of upgrading to more energy-efficient heating technologies. The government introduced a scheme to give regular payments to households which generate their own heat using certain qualifying renewable technologies (for example a biomass boiler) in April 2014. This is known as the Renewable Heat Incentive (RHI).
A government policy to implement by 2016 a zero carbon standard for new homes, together with tighter energy efficiency standards to support it, was scrapped in 2015. The aim of the policy had been to ensure that builders of new houses would be required to reduce carbon emissions from fixed heating and lighting, hot water and other fixed building services like ventilation. The government also scrapped its Green Deal scheme in 2015.
Keeping up with developments
Joining a trade association is an excellent way of keeping up with developments in your industry. Associations that represent the plumbing and heating engineering sector include the Association of Plumbing and Heating Contractors (APHC) and the Chartered Institute of Plumbing and Heating Engineering (CIPHE).
Subscribing to a trade journal is another excellent way of staying up to date with developments - examples include Professional Heating and Plumbing Installer and H&V News.