Construction facing biggest skills shortage in a generation

With Brexit uncertainty weighing down heavily on the construction sector, tackling a looming skills shortage must be a priority.

The irony of the shortage of trade negotiators in Whitehall won’t be lost on construction bosses. As civil servants face up to years of skills shortages presented by the unprecedented challenge of post-Brexit trade talks, and are forced to scour the globe to recruit skilled negotiators, the construction industry has long known what it’s like to rely on overseas talent to plug skills gaps.

Heavily reliant on migrant workers from Europe, with 12 per cent of our construction workforce currently of non-UK origin, the UK construction sector has struggled for years with skills shortages. But the prospect of a supply of migrant workers being cut off due to Brexit means this could quickly develop into a full blown crisis.

Industry voices have warned of this prospect for some time. “If you ask any housebuilder what their main challenge is, they say it’s labour availability,” explains David Thomas, chief executive of Barratt Developments. “Fifty per cent of our 14,000 subcontractors are from Eastern Europe,” adds Tony Pidgely, chairman of the Berkeley Group. While others, like Jacqueline O’Donovan, managing director of O’Donovan Waste Disposal, argue that construction will be “unable to function” in a Britain outside of the European Union.

Such warnings only add to a growing Brexit uncertainty, and this week MPs launched an inquiry into the construction industry to find out if it has enough capacity to build the homes we desperately need. In the months ahead, as industry leaders appear before MPs, we’re likely to hear a lot more detail about what a shortage of labour will mean for housebuilding in the UK.

With housebuilding currently running at around half the level needed to meet demand, and recruiters arguing that a million more construction workers are needed if housebuilding targets are to be met, the industry is now at a crossroads.

“Our industry, in my opinion, is as important as the finance industry and yet we do not have the same voice.”

Confidence has taken a hit. Uncertainty over Brexit saw the construction industry experience its worst contraction in seven years in June, and shares plummeted. Add to this latest Local Government Association research showing that four million people will need affordable housing by 2024 and the pressing need for Government intervention to get Britain building again is all too apparent.

The Federation of Master Builders has already called for the Government to stop “dithering” and the former Business Secretary, Vince Cable, wants a national plan, getting business and government working together to co-ordinate skill training among other things.

Any such plan may well need to consider something similar to the quota system for construction workers from Ireland in the 1960s, an idea already mooted by the Homebuilders Federation. It will definitely require a huge long-term training programme, but most importantly ministers must address industry concerns with a sense of urgency.

Many believe construction needs to be taken much more seriously by government and a comparison made a few years ago by the former Bouygues UK chairman, Madani Sow, continues to resonate.

“Our industry, in my opinion, is as important as the finance industry,” he said, “and yet we do not have the same voice.”

“Construction needs to find its voice in government. Otherwise we’ll all be short changed by Brexit.”

While ministers have moved quickly post-Brexit to offer assurances that everything will be done to protect the City of London’s position as dominant financial centre, next to nothing has been said to assure the construction industry. This is after all an industry that employs over two million people, contributes well over £100billion a year in economic output and is absolutely vital to the economic and social health of the nation.

It’s time ministers recognised this. Instead of appearing in photo ops wearing hard hats on site visits, they need to rise to the skills challenge we face and come up with a real plan to protect our position as a leading global economy.

If you recognise how important our construction sector is in laying the foundations for future prosperity and building the homes communities desperately need, then write to your MP now. Ask him or her to make sure tackling a skills shortage in our industry post Brexit is a priority.

Construction needs to find its voice in government. Otherwise we’ll all be short changed by Brexit.

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