Construction sector ‘must act now’ to take advantage of return to growth

Steven Radley
Steven Radley

The UK construction sector must act now to take advantage of the return to growth and ensure it has a workforce fit for the future, according to CITB director of policy and strategic planning Stephen Radley.

It follows the publication of a new Construction KPI Report from CITB and industry analysts Glenigan, which highlights the mixed economic conditions the sector has faced recently.

Commenting on the new research, Mr Radley said: “The new economic climate presents the ideal opportunity for the construction industry to meet the challenge head-on and develop and retain the skilled workforce it needs for economic and commercial success.”

He added that UK Government plans to invest heavily in the country’s infrastructure networks should offer fresh opportunities to building firms.

These include the chance to “plan ahead with certainty, invest in skills, and work with government to attract more young people into a sophisticated industry with great prospects.”

The report indicates that construction costs and projects are becoming more predictable, creating more stable conditions for employers.

It said that compared to the situation in 2012, when the last report was published, cost predictability has either improved or stayed the same for the country’s building firms.

This year’s UK Construction Key Performance Indicators Annual Report also shows that 69 per cent of projects have been delivered at least on budget, compared to 61 per cent two years ago.

Elsewhere, the study highlighted that a growing number of women are entering the construction trade.

It said that compared to the 2012 figure of 15 per cent, the average proportion of female workers has gone up to 19 per cent.

The data additionally suggests that builders are becoming more skilled, with a median of 71 per cent now qualified to NVQ Level 2 or higher.

Among its other findings, the research team said that Building Information Modelling (BIM) is having a growing influence on construction projects. It said BIM has been applied to 9 per cent of completed schemes this year, compared to 4 per cent two years ago.

However, trading conditions remain tough for construction firms in terms of their profitability, with employers still facing a number of key challenges.

The Glenigan/CITB report, which has been endorsed by the Government’s Department of Business, Innovation and Skills, and Constructing Excellence, warned that:

  • Margins have dropped to their weakest point in a decade and a half, with profitability falling to a level of just 2.1 per cent.
  • The construction industry’s profitability is now markedly lower than the reading of 2.7 per cent which was seen back in 2012.
  • Glenigan’s economics director, Allan Wilén, said builders must respond to key industry challenges in order to make the most of future opportunities.

    He said: “In particular, clients’ expectations continue to rise and delivering improved productivity, containing costs and accelerating the delivery of projects will all be priorities.”

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