Construction in the UK is booming at present. In August, growth was recorded at its fastest rate for seven months, however for the last 16 months in a row there has been continued growth as the industry recovers from the economic downtime which hit it incredibly hard. There is now renewed optimism, more houses being built and greater job opportunities, yet there could well be problems to face in the not too distant future.
Despite this growth and the positive effects it’s having on the economy as a whole, contractors are being pushed to the limit as the material supplies required to meet the renewed demand are tight and a lack of skilled workers reduces the speed at which jobs can be completed.
Here, the specialists at Geobond run through where potential problems could lie and how the future is looking;
A Lack of Skill in the Workforce
During recession laden times, the Construction Industry Training Board (CITB) suggests that almost 400,000 people left or lost their jobs whilst a further 400,000 are due to retire over the course of the next five years. This has and will subsequently leave a significant skills gap as those who left the sector are reluctant to return in fear of the same thing happening again and are likely to have found new jobs where they are settled and don’t need to look elsewhere.
It was thought that apprentices could help fill this gap, however firms appear to be reluctant to go down this route with City & Guilds reporting that over 50% of construction companies had no plans whatsoever to take on apprentices at any stage over the next 12 months, with 40% not employing a single apprentice in their ranks.
When this is combined with the fact that the number of young people taking on apprenticeships in construction has been falling too, it is a very real concern as finding the right people to take on the increased workload is proving to be difficult.
The Consequences
As a consequence of this, firms are having no option but to turn to subcontractors, who have since risen their rates to record highs to make the most of this need for their workforce. This is in turn putting additional pressure on the firms as they are forced to pay inflated prices as they simply don’t have the man power to deal with tasks before them.
A Materials Crisis
It’s not just the workforce where problems lie for construction firms though as suppliers of the vital materials required to complete the additional projects are struggling to increase their work load to that achieved before the financial crisis.
This results in delays when it comes to getting much needed supplies to site, which will have a knock-on effect on completion time and may have further consequences for other projects scheduled in for afterwards too.
There is very little that can be done on the side of the construction firm in regards to this issue as the likelihood is that when fewer building projects were being completed in the times of hardship, the suppliers were affected too which led to unemployment and a position today of attempted recovery.
It can’t be argued that the industry is recovering well, yet there is no doubting that more needs to be done to ensure this is sustainable. A drive to encourage more skilled workers back into the sector needs to be undertaken whilst the suppliers need more support from the industry authorities to have the infrastructure in place to meet demand; if these two things can be achieved, the future will remain bright, but only time will tell as to whether or not this can be achieved.
