THE Chamber of Commerce has raised concerns over the “challenging conditions” facing the construction industry – after more firms announced that they have shut their doors in what it described as “another blow” for the sector.
Kalmac, MAC Energy and Eden Interiors – all part of the MAC Group – issued a joint statement yesterday in which they said they had ceased trading and applied for insolvency.
The statement explained that the companies had “suffered greatly” over the last year, reportedly having lost two-thirds of their work in Jersey due to a “downturn” in the housing market.
It continued: “Despite our greatest efforts, securing substantial work going forward, we have been unable to raise the capital required to overcome the historical debt to allow the businesses to trade going forward.
“This, coupled with ongoing bad debts, have made the businesses unviable and continuing would have created further risk to our suppliers and subcontractors.”
The statement added: “We are absolutely devastated that with the ceasing of the companies, this also involves our 78 employees losing their jobs and livelihoods, and this in itself is heartbreaking.
“We understand that this news will come as a shock, and we deeply regret the impact this decision will have on all our employees, clients and supply chain.
“We assure you, we will work with the liquidators to try and protect your interests during this extremely difficult and distressing time.”
The news comes just months after Kalmac Construction managing director James Joseph warned that the industry was going to “really feel a pinch” shortly after the first quarter of 2024, forecasting a drop in available work of around 30% to 40%.
Last year, the Island’s construction sector also saw the collapse of firms Camerons and JP Mauger – sparking fears of a negative ripple effect on the economy.
Simon Matthews, who chairs the Chamber of Commerce’s Building, Housing and Environment Committee, said he was “saddened” by yesterday’s announcement.
“Our thoughts are with all those individuals and organisations impacted by this decision,” he continued.
“This is another blow for Jersey’s construction industry, and further evidence (if it was needed) of the challenging conditions the construction and development sector face at present.”
He added: “Coming a little over 12 months after the demise of Camerons and JP Mauger, the news by the companies is not surprising. Trading conditions remain stressed, and order books for the sector remain low.”
However, Mr Matthews also said that further losses in the sector could be avoided, if public and private sector clients can be “encouraged to continue to invest in their construction projects, big and small”.
Mr Matthews continued: “Jersey’s construction industry remains well-supported with good local organisations, professionals and tradespeople.
“Whilst borrowing and other finance costs remain high for private-sector clients, we urge in particular the Government of Jersey, through all its many public organisations, to ‘speed up’ their planned future capital projects and help local builders and tradesmen with opportunities to deliver quality construction projects.
“The sooner these projects can be turned into on-site activity, the better the chances of the local industry surviving the present challenging conditions.”
Officers from Customer and Local Services yesterday met a number of the affected employees to discuss their concerns and the potential support available.
Steve Jackson, the group director for the department, said: “We understand that employees and their families will be facing uncertainty and we encourage anyone who might be concerned to contact Customer and Local Services for help and guidance.
“Officers will ensure that they have the support they need to understand all of the financial and employment support that will be made available at this difficult time.”