Business owners are being left feeling suicidal due to late payment it has been revealed. 9 out of 10 business owners across the UK’s construction industry have suffered a variety of mental health issues due to payment and other business pressures according to a new survey.
The survey has been conducted by the countries leading engineering services trade bodies BESA and ECA along with 25 other construction trade bodies.
The survey has found that business owners suffer an array of significant mental health problems due to the stress and pressures caused by late or unfair payment.
Mental health issues caused by the late payment include:
- Stress (80 per cent)
- Depression (36 per cent)
- Extreme anger (38 per cent)
- Anxiety and/or panic attacks (40 per cent)
- Insomnia (36 per cent)
- Suicidal feelings (10 per cent)
Unfair payment practices also have a significant impact on employees right across a business, in addition to CEOs, directors, managers and executives. Of all the respondents, four said they had attempted suicide as a result, while 80 per cent reported a mental health issue.
Over 41 per cent of Business owners advised that it had also affected their personal relationships.
BESA CEO David Frise said “Systemic payment abuse causes broken lives and broken buildings and must be stamped out. The economic damage of these practices is well known but this survey has shed light onto its devastating human cost. Thousands of owners and workers of SMEs have struggled and suffered with this abuse for too long and with a General Election underway they will be reflecting upon who will most likely represent their concerns.”
ECA Director of CSR Paul Reeve says “Everybody expects business to deal with everyday pressures, but stress and other mental health impacts come from sustained and excessive pressure. It’s absolutely clear from these findings that poor payment is a serious cause of mental health issues across the industry and that the problem, far from being isolated to certain individuals, is commonplace among top management.
“These problems quickly knock on to employees and families alike. Findings such as these mean that clients and other buyers need to greatly improve their approach to supply chain payment and it’s a sad reflection on the industry that it will probably take legislation to achieve it.”
Over nine in 10 respondents (92 per cent) said their business had faced late payment issues. Almost two-thirds (65 per cent) said they were paid late frequently or very frequently.
The survey was held in association with the Prompt Payment Directory. Survey supporters cover a range of construction activity, including electrical, plumbing, building, scaffolding, roofing, civil engineering, fire safety, painting and decorating, and interiors. They include SELECT, the Scaffolding Association and Chartered Institution of Civil Engineering Surveyors.
The survey supporters are all part of a wider industry coalition pressing the Government to reform the practice of cash retentions in construction. Cash retentions is widely considered to be one of the most unfair and abused payment practices in the industry.
ECA Director of Business Rob Driscoll said “The next Government must take immediate action on cash retentions and other payment abuses, by legislating for change. Doing so will help to address the serious findings in this survey and actually help construction to achieve its aspirations of delivering excellence for clients and being an industry that’s attractive to new talent.”
This survey, aimed mainly at business owners, CEOs and managers, was run by ECA and BESA, in association with the Prompt Payment Directory. The survey received 613 responses in total, with 213 of these from business owners and sole traders. It was held between 12 September and 10 October 2019.
The survey was also supported by twenty five other construction industry organisations:
- Asbestos Removal Contractors Association (ARCA)
- Association of British Certification Bodies (ABCB)
- Association of Geotechnical & Geoenvironmental Specialists (AGS)
- British Blind and Shutter Association
- British Coatings Federation
- British Constructional Steelwork Association (BCSA)
- British Drilling Association (BDA)
- Chartered Institution of Civil Engineering Surveyors
- Confederation of Construction Specialists
- Confederation of Roofing Contractors
- Federation of Environmental Trade Associations (FETA)
- Fire & Security Association (FSA)
- Modular and Portable Building Association (MPBA)
- National Federation of Builders (NFB)
- Refrigeration Compliance (REFCOM)
- Scaffolding Association
- Scottish & Northern Ireland Plumbing Employers’ Federation (SNIPEF)
- SEC Group
- Single Ply Roofing Association
Leading Business Debt Recovery specialists Federal Management advised that by taking a positive action can ease the stress caused by unpaid invoices. Chris Spencer, Operations manager said “Late or unpaid invoices can be an extremely stressful thing to deal with. People provide their services in good faith and expect to be paid accordingly but that is not always the case”
“It is important to take positive action where you feel that your good will is being abused. We speak to many Business owners every day who feel that they are simply been taken for a ride, often by much larger firms”