West Midlands brick-making firms to shed 600 jobs in crisis
Two of the biggest brick making groups in the UK are planning to cut 600 jobs between them.
Ibstock, which has sites in Cannock and Aldridge, and Forterra, which has a factory in Cradley, announced the redundancy plans today.
They are preparing for an economic downturn over the coming months, as brick demand could remain down by around 20 per cent.
Ibstock said it had entered into consultations with employees across the group as part of a series of restructuring proposals and up to 375 positions, representing around 15 per cent of the group's total workforce, would potentially be impacted as a result.
Ibstock is also looking at closing sites down. The Leicestershire-based business is the UK’s biggest brick maker and has its Atlas factory at Stubbers Green Road, Aldridge, and its Cannock site in Lodge Lane.
Forterra, which makes special shaped bricks at Cradley, said its restructuring plans could lead to the loss of around 225 jobs, primarily from its concrete products facilities, particularly Swadlincote. It is the country’s second biggest brick maker, with nine brick factories, making around 590 million bricks a year.
Ibstock saw a sharp decline in sales volumes from late March as the Government measures to control the Covid-19 pandemic began to take effect and its construction and house building customers closed sites. During April, volumes in its clay bricks division fell by around 90 per cent on the year.
As the construction and house building sectors have begun to return to work over recent weeks, trading conditions have started to improve. It has seen a modest recovery in clay brick sales although volumes currently remain around 70 per cent below the same period last year.
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Group revenues for the three months to the end of March were down by approximately 10 per cent compared to a year before with a decline of around 75 per cent in the two months to the end of May.
The group has utilised the Government's Coronavirus Job Retention Scheme for a significant portion of staff during the shutdown period.
It is conducting a review of all operations which is expected to lead to a material reduction in the group's fixed cost base, through selective site closures, changes in operating patterns and changes to the size and structure of support functions.
Forterra, which is based in Northampton, said sales were down 86 per cent in April and 62 per cent in May, and orders were now around half what they would normally be.
Twelve of its 18 sites are currently open, with most of the rest expected to open by July.
“Economic and industry forecasts indicate a prolonged impact from Covid-19 on the UK economy and more specifically the construction sector.
“Although the Construction Products Association’s most recent forecast anticipates the residential construction market will recover during 2021, output in 2021 is forecast to be approximately 20 per cent lower than in 2019," Forterra said.
Its plans include changing shift patterns and centralising the manufacture of all of its pre-cast concrete flooring products at its Hoveringham facility in Nottinghamshire.