Survey: Business owners depressed and suicidal due to late payment
Industry-wide survey shows impact of late and unfair payment on mental health in construction
12 November 2019
A remarkable nine out of 10 business owners across construction suffer a range of mental health issues due to payment and other business pressures, according to a survey run by leading engineering services trade bodies ECA and BESA.
The new survey, conducted in association with 25 other construction trade bodies, found that business owners have an array of significant mental health problems due to the pressures of late or unfair payment, including:
- 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, including 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.
Furthermore, over four in 10 (41 per cent) of all respondents said that payment issues had strained their relationship with their partner, with five per cent reporting it caused it to breakdown entirely.
ECA Director of CSR Paul Reeve commented:
“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.”
BESA CEO David Frise commented:
“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.”
Over nine in 10 respondents (92 per cent) said their business had faced 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 (see Notes to Editors for full list).
The survey supporters are all part of a wider industry coalition pressing Government to reform the practice of cash retentions in 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 concludes: “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.”
The BESA and ECA – Working together to represent the engineering services sector
- Support and awareness of the Aldous’ Bill is being coordinated by the Building Engineering Services Association (BESA) and leading electrotechnical and engineering services body ECA.
- ECA and BESA collaborate on a range of issues in the engineering services sector. The partnership brings together the two leading associations representing engineering services; some 4,000 businesses with a combined annual turnover of almost £10bn.
- Together, ECA and BESA cover a range of engineering, design, installation and facilities management activity, including electrical, heating, plumbing, energy management, micro-generation, ductwork, ventilation, fire and security, and wireless systems.
- Joint work includes representation in key areas like contracts, procurement, payment and health & safety.
- Overall, the engineering services sector accounts for some 40% of UK construction/maintenance turnover.
About the survey
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 25 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