Local builders appear to be taking a bashing as a combination of householders with less money in their pockets and a freezing housing market takes its toll.

Each quarter their trade body FMB conducts a state of trade survey where it measures (among other things) the balance between those seeing workload rise and those seeing it fall. The figure for the first quarter of this year came in at -8 compared with +6 at the end of last year.

This sharp fall was perhaps predictable, as the fourth quarter 2007 survey had shown one of its worst ever figures for new enquires (a balance of -14).

This does suggest that the credit crunch problems in the financial markets are increasingly leaking into the real economy. And it is impacting on the construction industry where you would have expected it to be felt first – among the smaller building firms working on smaller jobs for households.

The FMB does draw a link between the fall in workload and the tighter credit markets and this seems a fair call, as the worst hit sector was private housing RM&I. Here the balance of firms seeing rising and falling workloads plunged from +8 at the end of last year to -38 in the first quarter.

Sadly the prospects do not look good. Local builders generally do better when the housing market is active and people are moving and looking to do their houses up, either for sale or after they have bought.

The latest figures for property transactions provide yet more gloomy evidence that the market is slowly gumming up. Transactions for February were the worst for three years and the trend is down.

The survey suggests that employment among local builders fell in the first quarter. The FMB suggests that it will bounce back. That may prove rather optimistic.