London’s construction industry is struggling to attract and retain the workers it needs. And this is a huge problem: skills shortages are driving up the high cost of building in the capital, and contributing to the poor quality of workmanship in the construction sector.
This crisis is manifold. The UK’s construction workforce ageing, with one in ten workers estimated to leave the sector in the next nine years. It’s also at huge risk from Brexit, with almost a third of London’s ‘construction of buildings’ workforce from the EU, compared to just 10 per cent in the rest of the UK. Last week, the Migration Advisory Committee’s report on EEA workers recommended a salary threshold of £30,000 for high and medium skilled EEA workers in the future, with no explicit work migration route for low-skilled workers, and no introduction of regional variation.
But it’s not just the prospect of losing EU workers that the industry needs to be concerned about: more workers are leaving the profession than entering already. In 2017 alone, twice as many workers left the construction industry as joined it, a trend projected to worsen over the next few years. This is despite demand for on-site occupations outstripping levels of current employment: recent findings from the Greater London Authority indicate that demand for plant mechanics, scaffolders and bricklayers exceeded 300 per cent of 2015 employment levels.
Meanwhile, despite the introduction of the Apprenticeship Levy in April 2017, London has a consistently low number of construction apprenticeship starts, with take-up declining by almost 50 per cent in the five years to 2016, even as need has intensified. A recent survey of apprenticeship leavers by the Construction Industry Training Board found that over a third cited low pay and slow career development as reasons behind leaving.
So how can the construction sector inspire its current workforce, but also encourage the next generation of workers to come forward? With the construction industry in desperate need of a pipeline of younger and skilled employees, it’s time for the sector to embrace Modern Methods of Construction (MMC).
MMC, also known as modular housing or off-site construction, have the potential to deliver housing much quicker than traditional construction methods, as well as provide cost savings, greater certainty and achieve higher quality. Modular techniques will create jobs for a range of skills, engineers and surveyors as well as low skilled jobs on-site. This might entice would-be apprentices who could be put off by low pay and a lack of personal development opportunities.
But the transition to widespread adoption of off-site construction to date has been slow. A step change in developing the skills to take it on will be needed to ensure MMC can be a part of the solution to London’s housing crisis.
London mayor Sadiq Khan has demonstrated his commitment to improve skills in the sector through the Mayor’s Construction Academy (MCA), which includes supporting the development of training provision for the construction of precision manufactured housing. Taking this forward, the mayor should consider how to use devolved skills funding to help existing construction workers develop the new skills required to implement MMC. Now is the time for developers and the wider industry to start investing their workers, upskilling them to future-proof housebuilding in the city.
Amy Leppanen is communications officer at the Centre for London.
