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For the industry as a whole, 2004 was a year of solid growth. The quoted giants and household names such as Balfour Beatty, Persimmon, Amec and Wimpey dominated the industry with huge pre-tax profit and 10-digit turnovers. And in the less risk-averse and more entrepreneurial world of private companies, staff were also rewarded.

It was the year in which a 15% increase in collective turnover contrasted with a 0.6% drop in contractors’ average operating margins to 2.2%. Indeed, heightened turnover accounted for an overall pre-tax profit among the top 100 firms of £4.1bn, up 13% on 2003. In general, salaries also reflected this upward trend.

Persimmon and Wimpey have swapped places in terms of the most profitable housebuilder. Persimmon, widely believed to be on the lookout to buy companies that could catapult it into the FTSE 100, edged closer to the £500m profit mark at £459.6m.

As usual the quoted giants dominated the top 20 contractors and housebuilders, in both turnover and profit. Arguably, Taylor Woodrow turned in the best performance among the group; it was ranked third in terms of turnover – £3.4bn – and pre-tax profit – £390m – and made up a lot of ground on Amec.

Balfour Beatty, despite achieving the biggest turnover and strong pre-tax profit in 2004, kept its feet on the ground by paying chief executive Ian Tyler £477,000, making him 35th in the league of highest-paid directors.

Bowmer & Kirkland, which had had the highest-paid director in 2003, slipped out of the directors’ pay league altogether in 2004, despite the fact it moved up four places in terms of pre-tax profit to 24th. Stewart Milne, second last year, took first place, paying its top director a staggering £3.7m – almost half as much again as the top salary of 2003.

Overall though, the average pay for the best-paid executives rose only modestly, just shy of 5%, to £494m. Average salaries at those companies rose a similar amount, almost 6%, to £30,600.

However, viewed in terms of actual pay, some interesting statistics emerge. The best-paid executive at Stewart Milne, for example, was paid 123 times more than the average worker at the Scottish housebuilder, who was paid £30,000. This reflects the fact that, in the past 10 years, the average wage in the industry has risen 65%, whereas the best paid directors are earning an average of 133% more in the same period. Pay is always a controversial subject and those companies, particularly quoted companies, that pay out fat salaries to managers despite poor financial performance open themselves up to widespread criticism.

Directors’ salaries among the top housebuilders, whose rewards are more closely correlated to performance than contractors, continued to be driven by bonuses. Of the top 20 highest paid, almost all received bonus packets fatter than their basic wage, with the exceptions of Wilson Bowden and Redrow.

However, 2004 produced fewer millionaires in the industry – just six of the top executives made more than £1m compared with eight in 2003. And average pay fell at 16 of the top 85 best average payers, which was consistent with last year.

Thirteen of the companies with the highest-paid directors also made the top 20 in terms of pre-tax profit, but only two of those companies, both housebuilders, rewarded their staff at a similar level of growth to its top executive. Berkeley Group paid an average salary of almost £53,000, up 13.3% on the previous year. Crest Nicholson was also among the most improved in terms of staff pay, up 4.1% to take 10th place with an average wage of £39,000.

The two best payers in 2004 had much in common. They were both contractors rather than housebuilders, neither appeared in last year’s Top 100, and both have roots outside the UK. Multiplex may have suffered an onslaught of bad publicity since it announced that it had already made a £45m loss on Wembley, but staff within the UK business of the Australian-owned contractor and developer were the best paid last year, with an average salary of £67,300, up 18.3%.

Staff at Canary Wharf Contractors, whose original roots lay with Canadian entrepreneur and developer Paul Reichmann, came off second best, with an average salary of £54,500. This contrasts with the £18,000 average salary earned by staff at social housing refurbishment company Connaught, which languished at the bottom of the average salary league.

One of the most impressive performances overall last year was from Gladedale Group, the little-known but much talked-about private housebuilder. It climbed up the ranks in all the tables relevant to the company. Most notable was the fact that it moved up 50 places to 20 in the highest-paid director league. In 2004 its highest-paid director received £655,000, 233% more than the £197,000 it paid out in 2003. The industry is likely to hear a lot more from Gladedale, based in Epsom in Surrey and run by founder, chairman and chief executive Remo Dipre, in 2005. It has already proved itself to be an acquisitive company, snapping up Bett Homes, a Scottish and northern England-based housebuilder, for £95m in 2003. It also took Country & Metropolitan private for £72m in March this year.

Gladedale is unlikely to stop there, not least because its plans to buy regeneration specialist Countryside Properties at the end of last year were scuppered when the Cherry family (the company’s founders and majority shareholders) rejected the approach and achieved a management buyout in January this year. With the promise of further corporate activity in the housing sector in 2005 – US housebuilder Centex has already put its UK subsidiary Fairclough up for sale and rumours persist that Fairview is a ripe takeover target – it is likely that Gladedale’s name will be included in the mix.