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Fierce competition for jobs reflects regional imbalance

There are almost twice as many jobs coming to market in the construction industry in London and the South-east than the rest of the UK combined in 2013 to date, according to new data shared with Construction News.

Data from CareersinConstruction.com – the UK’s largest construction jobs board – shows that the UK’s regional imbalance is deepening, with London and the South-east far outperforming the rest of the UK in terms of available work.

The sector seeing the most jobs come to the market is engineering, with 10,236 jobs available to date in 2013, followed by 5,219 in construction management and 2,892 in surveying.

Building services, meanwhile, has recorded 2,508 jobs coming to market, while architecture has had 1,243.

Of all careers, architecture is proving itself to be most competitive, with 17 applications on average for each job on offer.

Construction management has seen 11 applicants per job, compared with six in building services, just over four in engineering and just under three in environmental services.

While the total number of jobs posted on CareersinConstruction fell in December, the figure over the past three months has steadily risen and reached a milestone of more than 4,000 live jobs in April.

The lion’s share of new jobs in 2013 are in London and the South-east, with 6,601 coming to market in the former, each attracting an average of seven applicants, and 6,397 in the latter, each with six applicants.

“CITB has estimated that the industry needs to create 29,050 new jobs annually in order to replace workers retiring and leaving construction”

At the other end of the scale, just 427 new construction jobs have been listed in Wales so far in 2013, where eight people battle for each job, while the North-east has seen 365 new jobs created with 10 candidates for each.

In Northern Ireland, meanwhile, the findings are even bleaker, with just 27 jobs created and a whopping 17 applicants vying for each vacancy.

The Isle of Man and the Channel Islands were also revealed to be top destinations for job seekers, with 45 applicants per place in the former and 29 in the latter.

After a tough 2012 for the industry, major contractors including Balfour Beatty have been forced to cut jobs, primarily in back-office functions, while others including Kier have shut offices and smaller businesses continue to struggle, with 625 insolvencies in the first quarter of 2013 alone, according to PwC.

Cautious reception

CITB deputy chairman Judy Lowe warns against an overly optimistic interpretation of the growth in job numbers, saying it is wrong to “assume new employment means new business”.

She says professions required early in the construction process – such as architects and quantity surveyors – will be key bellweathers for a pick-up in work in the industry.

Faced with an ageing industry population and a natural turnover of staff, CITB has estimated in its recent Construction Skills Network annual report that the industry needs to create 29,050 new jobs annually in order to replace workers retiring and leaving construction.

The report found that there were 60,000 jobs lost in the industry last year and that in regions including Yorkshire & Humber and the North-west, output fell 10 to 15 per cent faster than employment.

It finds that employment will decline across the country until 2016, particularly in the West Midlands and North-east, when national construction employment is forecast to drop to 2.36m – its lowest level since 2000.

Government drive

Ms Lowe is one of several industry leaders, including chief construction adviser to the government Peter Hansford, to have met with skills minister Matthew Hancock at 11 Downing Street earlier this year under the Construction 4 Growth campaign.

“The issue of the UK’s skilled construction workers being sent overseas to supplement falling workloads is on the government’s radar”

Several leading contractors and trade federations, including C4G chairman James Wates, Rhian Kelly from the CBI, Bam Nuttall chief executive Steve Fox and Costain chief executive Andrew Wyllie, were present at the January meeting where the government was lobbied to ensure skills aren’t lost due to falling workloads.

Major firms are increasingly sending UK workers to countries where UK engineering skills are still in high demand, and CH2M Hill international division president Jacqueline Hinman told Construction News last month that she was not worried about fulfilling a pledge to recruit 500 new UK workers this year, as UK engineers could be sent abroad if work fails to materialise here.

The issue of the UK’s skilled construction workers being sent overseas to supplement falling workloads is on the government’s radar, and efforts are being made to invest in future generations of skilled construction workers through investment – such as Mr Hancock’s announcement last week that Barnsley College will receive £3.6m in government funding toward building a new £10.8m construction centre.

Leading the way

Leading contractors are also attempting to tap into the skills market: Bam Nuttall announced a new partnership last week with higher education specialist Stephenson College and the Institution of Civil Engineers to develop a new undergraduate programme which involves embedding the ICE membership criteria within the course syllabus.  

Bam Nuttall apprentice and higher education adviser Kate Hickey says: “At Bam Nuttall, we strive to grow our own talent. Our apprenticeship scheme is one of our entry routes for young people into civil engineering and our Higher National Diploma programme follows on from this as an alternative to the traditional degree route.

“We made the decision to embed the technician membership of the ICE into our HND programme to provide our trainee engineers with the opportunity to become recognised as professionals in our industry.”

Others, including Costain, are recruiting engineers to provide patented solutions to engineering challenges. The contractor this week launched its Engineering Tomorrow umbrella for all its research and development work.

“We are recruiting talented skills in nuclear decommissioning, rail maintenance operations, in water, in delivering contracts on Crossrail”

Andrew Wyllie, Costain

Costain has 36 patents and its staff are continuing to develop new engineering solutions, which its chief executive Andrew Wyllie says led to the launch of Engineering Tomorrow to allow the firm to put ideas developed by staff in fronts of its main clients.

On staffing levels, Mr Wyllie says bidding and estimating teams are fully employed, adding: “We’re in the fortunate position where we’ve got more opportunities than resource” and noting that the firm needs to keep staff happy.

“We’ve got a very strong ambition for the Costain group, our people are mobilised and motivated by that,” he says. “We have to move fast to keep our customers, our shareholders and our people happy, because they want to be part of a growing business.

“In order to meet the requirements of the customers we need to broaden the skillset in the organisation, so we are actively recruiting for talented skills in nuclear decommissioning, rail maintenance operations, in water, in delivering railway-wide contracts on Crossrail – we’ve got vacancies across the whole business.”

Major London growth

However, the CareersinConstruction data shows the regional disparity continues, with Ms Lowe saying that the skills body is expecting further growth in London – the only UK region to have consistently grown over the past five years – and that the profile of new job creation suggests a shift towards major projects.

Projects such as the £14.8bn Crossrail scheme are shifting more from procurement into work on the ground, with more than 8,000 workers employed on Crossrail, rising to up to 14,000 at the height of its construction over the next two years.

However, major projects in the regions and devolved countries could help to address the imbalance. Ms Lowe says there is hope for Wales if the Wylfa nuclear project gets the go-ahead, creating thousands of new jobs in the region.

“The CITB had to re-home 1,200 apprentices in 2012 after the firms they were working with went out of business”

Japanese technology firm Hitachi acquired the Horizon Nuclear Power joint venture last October, which is aiming to build between four and six new nuclear reactors at Wylfa, Anglesey, and at Oldbury in Gloucestershire and would create 12,000 construction jobs.

But the government is still struggling to get the first major new nuclear project off the ground in the South-west, as talks between EDF Energy and the Department of Energy and Climate Change continue over long-term prices for electricity generated at the proposed Hinkley Point C plant.

The preferred bidders for the £2bn civils package for Hinkley Point C, a Laing O’Rourke and Bouygues joint venture, will let up to eight contracts worth £600m once they have signed their contract, which is still at preferred bidder stage despite being announced almost a year ago.

And the energy giant recently admitted it has been forced to cut jobs at the £14bn Hinkley Point C development after delays to reach agreement with the UK government.

Underemployed masses

More generally, Ms Lowe says, the figures show a “distorted” market, which is suffering from “massive amounts of underemployment”, as firms try to keep workers employed on 10 or 15 per cent of their order book.

This partially explains the lack of opportunities at the lower end of the market, she say, adding that small firms have “paired back to the lean minimum in order to cope with the recession – they often say they just don’t have the staff and the capacity to be able to train up new people, much as they’d like to”.

Ms Lowe says the CITB had to re-home 1,200 apprentices in 2012 after the firms they were working with went out of business.

CareersinConstruction data suggests the types of jobs boasting the most vacancies are civil and environmental engineers, quantity surveyors, project managers and design engineers.

These are followed by structural engineers, estimators, planners, and principal and geotechnical engineers.

There has also been a steep decline in contract working at the beginning of 2013, with just 1,361 contract jobs becoming available in the first quarter of the year – around a tenth of the total, with permanent positions making up the vast majority.

This compares with 1,877 in the preceding quarter, when one in sesven jobs advertised was for contract work.

However, 2013 has also seen a rise in part-time working, with 607 such vacancies in the first quarter, as opposed to 431 in the previous three months.

The most competitive salary bands are unsurprisingly at the higher end, with a job offering an annual salary of £200k to £250k seeing about 20 applicants per spot, while the least competitive was £15k to £20k, which has had almost as many completed applications as jobs on offer.

The fiercely competitive project management market has recorded 16 applicants per job on offer, while civil engineers have seen seven rivals face off for each job going.

Site managers face an even tougher market, with 27 applicants on average for each job coming to the market. A total of 18 prospective construction managers are up against each other for each job.

The greatest proportion of all vacancies are in the salary band from £50k to £75k a year, followed by the £30k to £40k and the £40k to £50k brackets.

While the £125k to £150k band is unsurprisingly highly competitive – with 16 jobseekers per vacancy – the figures show a stagnant lower end of the market, with just 359 jobs coming to market in the £15k to £20k range and only 452 applications – a ratio of 1.25 people per job.

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