Market constraints threaten home building’s apprenticeship pipeline, SME home builders warn
New research by the Home Builders Federation (HBF) shows 95% of SMEs believe apprenticeships are essential to addressing future skills shortages, yet market constraints are restricting builders’ ability to recruit and train them.
As National Apprenticeship Week platforms apprenticeship success stories, a new poll of SME home builders shines a light on the barriers smaller organisations face in taking on trainee recruits.
HBF’s survey of more than 100 small and medium builders has found that 95% of SMEs feel apprentices are vital to addressing the industry’s skills shortage, acknowledging the vital role apprentices play in expanding the workforce. But it also identified an alarming set of reasons preventing them from investing in the industry’s next generation.
Despite micro businesses making up around 80% of the construction industry, less than 16% of those businesses currently take on apprentices. A key contributing factor of this is the high cost of employing an apprentice, particularly while they are training as their productivity is understandably lower. When set against the current market outlook, this places even greater strain on employers’ bottom lines, making the risk difficult for many businesses to absorb.
As buyers continue to grapple strained affordability, the lack of confidence that buyers can be found for new homes grows across the industry. Meanwhile, increased taxes, levies and policy costs as a result of new regulation, like the Future Homes Standard, make it economically impossible to build within many areas. These things combined mean that it’s becoming harder for the nation’s smaller businesses to manage the associated risk and financial commitment of increasing housing delivery, let alone investing in supporting trainees and apprentices.
When asked about the barriers to taking on apprentices, respondents identified challenging market conditions (17.5%) as the main barrier alongside the ability of subcontractors to support apprentices until they are productive (17.5%), followed by ongoing challenges in finding suitable candidates (12%).
Estimates suggest that the construction sector will need around 47,860 extra workers each year to achieve Government’s ambitious housing targets. As a result, levels of apprentices within the sector are thought to need to increase by 200% to 300%.
While industry is working with the Construction Skills Mission Board to ensure effective access to training provision and support, the survey’s findings reinforce growing evidence of the need for action to address broader market and viability issues that risk exacerbating an already strained skills outlook.
HBF’s latest Housing Pipeline report, published in December 2025, warned of a viability crisis with planning permissions for new homes hitting a 15-year low as a result of growing red tape and affordability challenges slowing down the market. Despite hopes for government support to tackle such challenges, no such commitment has been made.
This latest insight validates concerns that market challenges will continue to have lasting effects on the housing – and talent – pipeline.
Industry is therefore calling for action to tackle market and viability constraints that are pushing up the cost of delivering homes, affecting ability to sell, threatening bottom lines and increasing risk for SMEs and subcontractors. It’s also urging government to increase funding to support SME and incentivise the supply chain to take on more apprentices, therefore protecting the future workforce.
Neil Jefferson, chief executive at the Home Builders Federation, says: “This latest insight demonstrates the impact of broad market pressures on SMEs, slowing down housing delivery and preventing them from investing in their future – and the long-term talent pipeline.
“Through engagement with the Construction Skills Mission Board, industry is influencing change to improve access to training provision and greater support to train apprentices. However, more needs to be done to mitigate the financial and operational risks that currently make it unviable for many small businesses to invest in junior talent.”