O’Brien Contractors’ MD offers his thoughts on how to make the most of the current boom – and prepare for future busts.
While the recession may officially be behind us, it continues to reverberate through the industry.
Many companies face unique and unprecedented challenges, particularly in the areas of talent, technology and resource.
While these three issues are interconnected and each has a important role to play in the future of the UK construction sector, perhaps the most significant is the problem of a diminished workforce.
The sector suffered a significant blow during the recessionary years, with 400,000 jobs lost and predictions that another 400,000 skilled employees will exit the industry through retirement by 2020.
This skills drought, which has been felt across all construction trades, has the potential to dent the continued growth of the industry and its contribution to the UK economy.
To ensure we can meet growing demand for delivery of construction projects, we need to demonstrate to school-leavers that careers in construction can be rewarding.
A fully trained professional can earn £100,000 a year in this industry, a figure that is being driven up as businesses boost salaries to attract and retain the best talent from a dwindling pool.
“Businesses can insulate themselves by ensuring they have a robust chain of trusted and experienced suppliers”
A younger, more tech-savvy workforce will also be of great benefit to the construction industry, as technology plays an increasingly prevalent role.
To fully harness the benefits of innovations such as building information modelling tools – which help to reduce costs and increase efficiency of material use – companies may need to consider refocusing their investment strategies to grow their technology presence and experience.
Methodologies such as BIM are particularly useful at a time when the scarcity of resources required to meet the upturn in demand is providing a significant barrier to continued growth and expansion.
This has placed enormous additional pressure on the sector, forcing companies to find alternative resourcing solutions.
Brace for impact
There is no quick fix solution to this problem.
However, businesses can insulate themselves by ensuring they have a robust chain of trusted and experienced suppliers in place.
There are of course a number of additional factors that are outside the control of the industry at large.
“Early contractor involvement is absolutely fundamental, enabling us to leverage our expertise from the earliest possible stage”
Chief among these are the tightening rules being applied by lenders, as well as tax changes levied by the government.
The double impact of reduced accessibility to funding, combined with increasing levels of corporate taxation, could place an even tighter stranglehold on the viability of businesses, not to mention their ability to address the aforementioned issues we all face.
Greater clarity from the political parties on promises over investment and policies towards capital expenditure would go some way towards offering businesses a modicum of reassurance.
Ultimately, we need to ensure we fully understand our customers’ needs and as an industry should be prepared to provide a more proactive advisory role if we feel a particular solution is really the right fit.
Early contractor involvement is absolutely fundamental, enabling us to leverage our expertise and industry knowledge from the earliest possible stage in the process.
In turn, this can lead to a more viable and cost-effective solution for a project, reducing waste material and driving down cost.
Put simply, those businesses that are brave enough to treat this post-recessionary period as an opportunity to reconsider and realign their core workplace functions will be the ones that not only flourish, but go on to weather the next dip far better than their competitors.
Peter O’Brien is managing director of O’Brien Contractors