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Inflexible deadlines, ferocious penalty clauses, constant long hours, risk, pressure and confrontation. Construction has always been a tough business – but now there are signs that it is getting worse. A combination of increasing competition and the barrage of initiatives to improve productivity are causing an epidemic of stress, made all the worse because it is seldom acknowledged by companies or even the individuals affected. The industry's macho culture means that people are reluctant to admit they are suffering, and the industry is only just waking up to what has become a serious problem.

John's experience is typical. A project manager in his mid-30s, he suffers from headaches that last for weeks, is unable to switch off when he gets home and finds it difficult to sleep. He feels he cannot turn to anybody for support.

"You don't need to be a rocket scientist to see that stress is a problem," says Don Ward, chief executive of the Construction Industry Board. "Construction has the second longest working hours of all industries in the UK. Only people in agriculture work longer." Ward is concerned that 60-hour weeks, plus the time spent travelling, are becoming a torment for many in construction. He says, "There is a proliferation of traffic accidents linked to construction workers because of the exhaustion they suffer, and I bet if you had the statistics, you'd see they have higher divorce rates than people in other industries." Cary Cooper, professor of organisational psychology at Manchester University, has researched the working practices of employees in hundreds of different occupations and he agrees that stress is a becoming a serious problem in construction.

"Construction is becoming a globally competitive industry. Short-term working contracts are more common, working hours are longer and deadlines are getting shorter. Most industries have deadlines but in construction there are financial penalties for missing them, which is a real strain on workers." For Cooper, the cost of construction's success is piling on to the shoulders of its staff.

There are some figures available for the cost of work-related stress on UK industry in general: about £10bn a year for sick leave and the annual loss of 25 000 people from the labour market. And research published this year by the Institute of Management identified the main factors causing excessive stress as deadlines, constant interruptions, lack of support, poor communication and incompetent management. What is not known is how this breaks down for the construction industry.

Unions such as UCATT and the GMB and bodies such as the Construction Industry Training Board admit they have not conducted any formal research, nor does the Construction Confederation have any plans to explore the matter – even though, as Cooper and Ward say, it is probably one of the most stressed-out sectors in UK industry.

Only a handful of organisations are beginning to respond. Ward is also secretary of the Respect for People working group, set up by the Movement for Innovation last year. It is to launch a report on 27 November concentrating on the "people issues" in construction.

Ward says: "We identify stress as a key concern, and that employers and employees have minimal guidance on how to deal with it. At the end of the day, what we're worried about is people's performance." A few enlightened employers are beginning to realise they will not get the best out of chronically stressed staff. Multidisciplinary consultant Arup is among the few employers in the sector attempting to tackle the problem.

The personnel department has attempted to honour what Cooper calls the "psychological contract" between employer and employee by setting up an employee assistance programme (EAP) as a way of helping staff deal with the pressures of their jobs.

Senior staff at contractor Mansells also decided to act. Philip Cleaver, chief operating officer, says, "We became concerned that the levels of stress in the workplace were too high and that problems in the staff's private life could spill over into work." Mansells bought an EAP package from its medical insurance provider that offers confidential counselling on emotional problems, domestic worries, career problems, and relationship and financial worries. Cleaver says: "The objective is the removal of avoidable stress. We see it as an obligation on one hand and a benefit on the other to help staff in this way." But although EAPs provide staff with counselling, they do not necessarily relieve the cause of the problem – they don't shorten hours or confront autocratic managers.

Professor Cooper advises staff suffering work-related anxiety to contact their company's personnel department or, if the problem is sufficiently intractable, to leave. For employees unable to approach their company with such a sensitive matter, finding another job is a more likely alternative.

But with construction set to become even more competitive, the pressure on employees will increase. And if, as a result, the sector loses workers or fails to attract new recruits, the cost of stress will ultimately be paid by employers.