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Labour shortage likely to impact construction costs

New research from international property and construction consultancy Gleeds has revealed predicted cost hikes as Brexit exacerbates pressure on a shrinking workforce. 

Douglas McCormick, executive chairman at Gleeds UK
Douglas McCormick, executive chairman at Gleeds UK

The consultancy’s latest Market Report survey found that nearly three quarters of those questioned believe there is a shortage of skilled labour in the UK, with 80 per cent reporting that tighter immigration restrictions will inevitably lead to worsening shortages and higher construction costs.

While 66 per cent of respondents stated that they believed Boris Johnson’s government to be largely ‘pro-business’, less than a quarter felt that it had listened to the construction industry during the Brexit negotiation process. Its failure to take account of the views of those operating in the built environment on issues such as expanding the shortage occupation list (SOL) to include key trades in favour of promoting home-grown talent may prove to be costly. For instance, over three quarters of those surveyed did not expect the latest government apprenticeship initiatives to be able to provide enough people to plug the considerable skills shortages.

Gleeds’ findings echo the sentiments of a recent report from the Construction Products Association, which found that the number of European Union-born workers in the UK construction sector dropped by more than a quarter in 12 months. The study recorded a fall of 28 per cent, far exceeding the seven per cent seen across the sector generally.

“Our latest report highlights real concern from within the construction industry around a worsening shortage of skilled labour. Clearly, the government’s ambition to build, build, build - a key element of the recovery plan for our emergence from the pandemic recession – is going to be heavily impacted if we do not have the manpower available to deliver its economy-saving programme,” says Douglas McCormick, executive chairman at Gleeds UK.

“Neither contractors nor clients have confidence in the ability of apprenticeships and training schemes to provide the required numbers of skilled tradespeople anywhere near quickly enough, and as swathes of EU residents are forced to either head home or stay away, it seems inevitable that an industry starved of labour will push the cost of building upwards.”

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