THE construction sector is facing rising costs and Island-specific pressures that could undermine its long-term sustainability, a regulator’s report has warned – as it called for “effective competition” in the industry and pledged further “surveillance” of the market.
The Jersey Competition Regulatory Authority yesterday published its final report following a months-long review of the sector.
The report, which analysed market structures, consumer experiences, comparative data and stakeholder engagement, concluded that “effective competition is essential to the future of the Island’s construction sector”.
It also confirmed the vital role that construction plays in Jersey’s economy, and the challenges the sector continues to face – from limited consumer choice in some areas and rising costs, to structural issues unique to the Island.
The authority’s chief executive Tim Ringsdore said: “We’ve heard loud and clear from businesses and consumers that there are real concerns about how the construction sector operates – and we’re committed to further surveillance of the market.
“This isn’t about pointing fingers – it’s about building a stronger, fairer sector. Jersey needs a thriving construction industry to deliver homes, infrastructure and jobs. Effective competition is key to making that happen.”
Costs and constraints
The report found that prices across the sector are generally higher than in other jurisdictions – largely due to Jersey’s reliance on bringing materials to the Island.
It identified transport and logistics as “underlying factors” that “impede cost efficiencies and inflate prices”, adding that “planning delays and regulatory burdens” may “hinder” smaller firms.
Stakeholders also pointed to “confusing land-use policies”, an “uncertain planning environment”, “misaligned and potentially burdensome regulations” and the absence of a framework equivalent to the UK Construction Act or an industry ombudsman.
Freight costs from the UK to Jersey were described as “relatively high, possibly also due to low shipment volumes and limited routes”, while specialist machinery often requires off-Island servicing, adding repeated transport costs.
While agreeing that demand and supply are influenced by Island-specific factors, the report argued that outcomes are not wholly determined by structural pressures.
Competition emerged as a concern among households, with survey data showing that 75% of consumers disagreed that there is sufficient competition among contractors to ensure fair pricing.
Scaffolding spotlight
The review focused on scaffolding as an area of concern after receiving complaints about sharp price rises in the wake of Storm Ciaran.
Survey responses received as part of the review had highlighted “post-storm price disparities” and “difficulties in sourcing scaffolding contractors”, while stakeholder feedback pointed to “potential risks on the scope for collaborative pricing practices among larger companies”.
In July, the JCRA issued an open letter to all scaffolding firms, reminding them of their obligations under competition law and inviting anyone with information about anti-competitive practices to come forward – although industry members strongly refuted any suggestion of price fixing or profiteering in the sector.
“The open letter generated significant engagement from market participants and members of the public,” it said.
The watchdog confirmed that it will “decide on the appropriate competition tool to use, if any, in the coming months” following “further surveillance”.
Speaking to the JEP following the publication of the open letter, C&M Scaffolding co-owner Lee Camfield described the regulator’s concerns as “a load of rubbish”, while A&A Scaffolding Solutions managing director Alex Wareham said the regulator’s comments “couldn’t be further from the truth.”
Aggregates and concrete
The regulator said it would look further into potential anti-competitive practices, with specific focus areas including concrete and aggregates, which are raw materials like sand, gravel and crushed stone.
The report read: “Engagement with stakeholders revealed that concrete prices in Jersey tend to be aligned (for concrete) and are significantly higher than in other jurisdictions. Concerns have also been raised around recent changes to the cost of inputs (notably sand).
The authority said it will now carry out an analysis to establish “the competition tool most appropriate to address the competition insights and challenges arising in this market.”
Workforce pressures
The competition authority also raised concerns about a future skills shortage, with the average age of a construction and quarrying worker being between 40 and 44.
It read: “The retirement of experienced professionals may leave the sector exposed to knowledge gaps, reducing efficiency and stability.”
The regulator identified Jersey’s housing qualifications system for migrant workers as a pressure in this area.
“Skills gaps in Jersey require firms to offer higher wages, which is also potentially impacted by housing policies for registered workers,” the report said.
“Jersey’s work permissions system was said to create obstacles for overseas workers and companies looking to enter the market. These include complexities around recruitment, business licensing, and other regulatory requirements.”
Construction background
The JCRA said the sector will remain under “active surveillance” through 2025 and 2026, and that it will decide in the coming months whether to take further action.
It comes as the government announced plans for a 25-year capital investment programme, which set out a long-term pipeline of housing, education, transport and public service projects.
The announcement of the ‘Investing in Jersey’ programme follows a string of high-profile collapses in Jersey’s construction sector.
The Style Group – which included AC Mauger, Style Homes and Style Windows – collapsed last month.
It followed the earlier closures of Camerons, JP Mauger, Kalmac, MAC Energy and Eden Interiors in 2023 and 2024, and K-Land Construction and Nicholson Builders this year.
In numbers:
- The construction sector contributed £400m – 7% of Jersey’s total GVA – in 2023.
- Around 40-50% of construction activity is driven by public sector spending or state-owned enterprises – higher than the 20-30% observed in the UK.
- 84% of Jersey construction companies employ fewer than six employees, and more than a quarter of businesses in the sector are sole traders.
- The average age for a construction and quarrying sector worker in Jersey is 40-44.
- The average sector salary in Jersey is £52,000, compared with £44,002 in the UK.
- Labour productivity in Jersey is estimated to be 34% lower than the UK due to lack of economies of scale.
- Material costs have risen by 50% since 2015, with many goods 10-30% more expensive than in the UK.
- 63% of survey respondents said construction costs had increased significantly in recent years, and 82% had a negative perception of the industry.
- The scaffolding market comprises five larger suppliers and scaffolding employs >100 people
