Constructions skills crisis

The skills crisis in construction has been widely reported in both trade and national press, and highlighted by professional bodies including the Federation of Master Builders (FMB) (FMB, 2018), Royal Institute of Chartered Surveyors (RICS) (RICS, 2018), and the CIOB (CIOB, 2013). This encompasses both skills shortages, i.e. difficulties in recruiting to specific roles arising from a scarcity of individuals with the required skills, and skills gap, i.e. a deficit in necessary skills within an organisation (McGuinness, Pouliakas and Redmond, 2018). Both are highlighted by Wiseman, Roe and Parry (2016) as negatively impacting the construction sector. 

 

This is not a new phenomenon, Egan warned of skills shortages in his report Rethinking Construction (1998), while Chan and Dainty (2007) cite Clarkes’ (1992) observations of an impending skills crisis.  A Department for Education and Employment (DfEE) (2000) report stated that during the late 1980s employers had difficulty in recruiting bricklayers and carpenters, the same trades in short supply today (FMB, 2018; Marriott and Moore, 2014). 

 

While its impact is still unclear, the vote to leave the EU, Brexit, will potentially exacerbate the issue. A report by HBF identified that, nationally, 17.7% of the housebuilding workforce comes from the EU, while in London this was nearer to 50% (2017). Chevin (2014) reported that the UK construction sector has relied on migrant labour to address the skills shortage, while Dromey, Morris and Murphy (2017) argue that ending free movement risks pushing current skills shortages into a crisis. 

 

Various reasons have been identified as to why construction struggles to attract new entrants. It has been acknowledged that there is an image problem, a Laing O’Rourke (2016) report suggested that it is seen as an unexciting industry, where the work is dirty, strenuous and low skilled. A Centre for Economics and Business Research (CEBR) (2017) report defines construction as a 4D industry, dirty, dangerous, demeaning and depressing. That said, Clarke and Hermann (2007) found only 11% of employers felt image was the reason for the low levels of interest. 

 

Egan (1998) acknowledged that there appears to be a crisis in training, with concerns over its quality, resulting in a decline in those entering the industry (Clarke and Hermann, 2007; DfEE, 2000). Dromey, Morris and Murphy (2017) described the skills system as dysfunctional, highlighting high numbers of construction courses failing to result in employment, only 41% of participants being employed six months after completion, 16% of these in apprenticeships. A DfEE report (2000) suggested this is due to training failing to meet employers’ requirements. Chan and Dainty (2007) pointed to the increase in self-employment within the sector as disincentivising employers from investing in training, or employers abdicating responsibility to train, deferring this to the CITB through levy payments. Marriott and Moore (2014) suggested that young people have low regard for vocational training overall, possibly indicating a reason behind the low numbers of young people undertaking construction training (Wiseman, Roe and Parry, 2016).

 

Construction has an aging, with Pye Tait Consulting (2015) identifying up to 400,000 retiring between 2015 and 2020. Failure to attract new entrants will further exacerbate the skills crisis. The CEBR (2017) report predicts that, in order to meet house building and infrastructure plans, the industry will require more than 400,000 entrants between 2016-2021. 

 

 

(CEBR, 2017)

 

 

The same report also indicated a potential loss of 214,000 EU workers depending on the outcome of Brexit.  A CITB (2018b) report suggested the industry will require a more conservative 158,000 entrants between 2018-2022, to meet predicted demand, though it is unclear if this includes replacing those retiring or leaving the industry. The difference could also be due to those roles that sit outside the scope of CITB, such as engineer, architect or fenestration.

 

Apprenticeships are acknowledged to be the main route into employment within construction (Kashefpakdel and Rehill, 2017; Pye Tait Consulting, 2015; Chevin, 2014). In 2015 the UK government committed itself to creating 3,000,000 apprenticeships by 2020 across all sectors (Department of Business, Innovation and Skills (BIS), 2015). Following the Richard Review of Apprenticeships (Richard, 2012), they have undertaken a complete reform of apprenticeship delivery, moving away from apprenticeship frameworks and onto apprenticeship standards (BIS, 2014). In addition, an apprenticeship levy has been implemented on employers with wage bills over £3,000,000 per year (Her Majesty’s Revenue and Customs, 2016), and an Institute for Apprenticeships, now the Institute for Apprenticeships and Technical Education (Foster and Powell, 2019), created to oversee the development of new apprenticeship standards, and maintain them once approved.

 

A CITB report (CITB, 2018a) stated that construction has seen a 49% increase in apprenticeship starts since 2012, with 26,195 undertaking construction apprenticeships in 2017. These figures differ from those reported by the Department of Education (DfE) (DfE, 2018d) which indicated 21,210 starts in 2016/17 and 22,458 in 2017/18 for construction. Accepting the CITB data, and assuming all complete and progress into employment, this only results in 131,000 new entrants by 2022, a 27,000 shortfall of the CITB figure of 158,000 (CITB, 2018b).  It should be acknowledged that not all new employees will enter the industry through the apprenticeship route.

 

UK government has set aspirational targets in terms of infrastructure projects and housebuilding, committing itself to £163 billion expenditure in its 2016-2020 strategy (Infrastructure and Projects Authority, 2016). In terms of house building estimates are that between 240,000 – 330,000 new houses will need to be built each year to meet demand in England alone (Wilson and Barton, 2018). These targets will be at risk if the skills crisis is not addressed. 

 

Sector productivity is also being affected by the skills crisis, already considered poor when compared to other sectors (Farmer, 2016: Dainty, Isons and Briscoe, 2005)

 

‘Productivity has been a thorn in the side of construction for decades.’

 (Green, 2016)

 

Marley (2015) identified that employees’ skills are being under-utilised, employees undertaking work below their skills capabilities, in order to compensate for skills gaps, resulting in lower productivity. 

 

This highlights the precarious position construction currently finds itself in, and in order to meet future demand it will need to consider how it attracts new talent. New technologies may help alleviate some, but not all, of the impact of the skills crisis (CEBR, 2017), even then there is a shortage in operatives for these technologies (Nadim and Goulding, 2010). An alternative could be to look at who, and how, industry recruits, and what obstacles need to be challenged in order to change this.

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