Skills shortage in construction industry

Currently, the United Kingdom is experiencing a skills shortage in the construction sector which is driving up wages and holding back vital infrastructure work – including efforts to build 1 million new homes by 2020 to end the country’s housing crisis.

The Royal Institute of Chartered Surveyors (Rics) said construction wages rose by 6% in 2015, well ahead of the 2% UK average, because there are not enough workers. Bricklayers and quantity surveyors were hardest to find, said the Rics UK Construction Market Survey, in which 61% of construction firms reported a sharp rise in wage costs. Nearly two-thirds reported financial constraints as net lending to construction firms dropped by £274m in the three months to November 2015.

A shortage of housing has driven up rents and house prices in recent years, particularly in London and the South East. Housebuilding is running at around half the level needed to meet demand, but housing starts have fallen in England. In the year to September 2015 there were 136,830 starts, down by 0.8% on the 12 months before, reported the Department for Communities and Local Government (DCLG).

In response to this obstacle, the Construction Industry Training Board (CITB) and the Home Builders Federation (HBF) recently launched a training initiative with £2.7 million in funding called the Home Building Skills Partnership.

The Home Building Skills Partnership was developed through research collected on specific industry and employee needs gathered from 40 UK homebuilders. From this collected information, the HBF and CITB finalised a framework for what skills, training and qualifications would be necessary for a worker to construct a home safely and efficiently. In addition, the partnership will develop a Homebuilding Training and Development Needs Analysis tool to ensure that the industry’s constantly evolving skill needs are adequately addressed.

The initiative came into force on 22nd March, and is overseen by a board comprised of senior industry representatives and the CITB. Approximately 3,500 construction businesses will benefit from the training and tools provided. In addition, an estimated 45,000 new workers will receive training and 1,000 experienced workers will earn new industry qualifications through the initiative by 2019.

In the meantime, however, the most recent data available shows that the demand for new homes is 25 per cent higher than it was at this time last year—and demand is expected to keep rising. Construction firms have been relying more on apprentices and inexperienced workers which can be a risk if the appropriate training and support is not provided. In addition, many firms have had to turn to new sub-contractors because established partners are already booked up. In that case, construction firms face the risk of the unknown and need to check testimonials and vet the level of insurance cover their new partners have in place.

All of this creates an increase in the amount of supervision required, but getting it right is important if firms want to avoid a rise in accident and defect rates. No firm wants any worker to be injured onsite or to see defect claims become an issue. Nor do they want insurance premiums to rise or their reputation to be damaged.

At a time when the construction industry is juggling an upturn in demand with the recruitment difficulties created by the ongoing skills shortage, A-Plan Commercial can offer guidance on the risks our construction clients are facing. Please get in touch with your branch for advice.