August 7, 2022

Are Labour Shortages the Future of the Construction Industry?

Labour shortages in the construction industry have been an issue for several years now. There’s a huge skills shortage and a lot of jobs to fill. Combined, this has created a large deficit that the UK struggles to catch up with. The combination of COVID-19, Brexit and the government’s pledge to build 300,000 new homes each year to tackle the UK’s housing crises means labour shortages in the construction industry are a big deal.

There are attempts on all fronts to combat this issue. One is to employ more labour workers from other countries to fill the gaps in the labour market. Business immigration law comes into play and solicitors can give employers sound advice and guidance on how to employ the right workers overseas to help with the labour shortages.

The real question is, are labour shortages the construction industry’s future? In this article, we’re going to illuminate this question with the root causes of these shortages, why they’re happening and what can be done to fix them.

What is the labour shortage?

The labour shortage broadly refers to the lack of qualified people available to fill job roles. In this case, construction work. When employers or an entire sector struggle to find suitable applicants to fill vacancies, this is a skills shortage in a particular area. Location and an employer being able to fund the work plays a big role. But there are many other factors that are hitting the UK construction industry particularly hard.

Why are labour shortages affecting the construction industry?

Put very simply, the UK has more construction work available than it does skilled workers to fulfil the jobs. A perfect storm of particular factors has come together to make this an especially big problem in the UK.

An ageing population, injury and COVID-19.

As with any physically demanding job, those who work in labour tend to retire sooner. The physical stress, the continuously demanding work and the COVID-19 have come together over the last two years and made a big impact. Along with the fact that many labour workers in construction were to retire over the last two years that the UK was largely shut down due to COVID-19, others have had to cease working because of long-term health effects from COVID-19 when they otherwise wouldn’t have.

It’s also the case that the industry is still feeling the bite from the Omicron variant in late 2021. Timber, concrete, steel, cladding, roofing, white goods and more are in shorter supply because of the impact. This has driven up costs while there’s less to go around.

Brexit and skilled labour from abroad.

The issue on everybody’s mind when we talk about the problem of labour shortages is the impact of Brexit. The fact is the UK employed many European labourers to do its construction work. But Brexit has seen an exodus in the hundreds of thousands since its implementation and with it, lots of skilled labour.

There’s also the aspect of business immigration law. Many employers still aren’t up-to-date with how to employ skilled workers from the EU and farther abroad. The impact of the stringent rules, extra loops one has to jump through and the potential extra costs of bringing in skilled workers from abroad have meant busy employers are having a headache. And the fact that the UK government has set out the proposal that after Brexit the UK should only bring in what it categorises as ‘skilled workers’, which often doesn’t include those needed to fill in the gaps in the construction industry, is making matters worse.

What are the impacts of labour shortages in construction?

There have been many substantial impacts on the construction industry already—and they don’t seem to be slowing.

First, a report has revealed that organisations in the UK are spending 6.6 billion a year as a result of the skills shortage. And the report outlines that construction is one of those industries most affected. This impact on business and the economy cannot be underestimated.

Second, simply put, work isn’t getting done. The UK government wants more homes built to combat the country’s housing crisis, yet it doesn’t have all the skilled labour it needs. Many works in London and other major cities around the country have been put on hold. Many employers find themselves looking far and wide for people to recruit who just aren’t there or are too expensive to hire due to the supply and demand imbalance. They’re having to borrow workers to fill the vacancies for higher prices.

How long will the labour shortages last?

It’s not easy to predict how long these labour shortages will last. Forecasts for 2022 show the number of unfilled vacancies is at its highest. This would suggest that labour shortages are going to last a long time. But there are a few things the UK government and employers can do.

Employers can get up to speed on how to hire overseas talent. Those who’re knowledgeable in business immigration law such as solicitors can guide employers in the right direction on how to bring in the workers they need to fill such vacancies. While there’s already been a call from employers to the UK government to ease certain immigration rules or make exemptions to tackle this issue, the labour shortages might be slashed if particulars were arranged so the UK can either bring in more skilled labour from abroad, bring up less qualified and younger people quicker or use a combination of both to fill the vacancies and get the construction industry booming again.