Analysis-Worker shortages raise doubts over Britain’s plan to build for growth
2024.12.13 01:25
By Suban Abdulla
WORCESTER, England (Reuters) – An acute shortage of construction workers could undermine the foundations of British government plans to get 1.5 million homes built by 2029 in England to help drive economic growth.
Prime Minister Keir Starmer’s Labour Party won July’s election on a pledge to boost growth and improve infrastructure, as well as fix public services. Construction represents 6% of gross domestic product, but underpins growth in other sectors.
While developers welcomed details of his plans for overhauling Britain’s planning system and freeing up more land for building, many say the ambitions of Starmer’s government are not achievable unless worker and skills shortages are addressed.
These gaps have raised questions about whether Britain needs to rethink its post-Brexit immigration system, alongside better training to get more young people into the ageing workforce.
“We haven’t really got enough workers to build the volume that we want to build now, let alone think that we’re going to get to 1.5 million homes over the next five years,” said Lioncourt Homes CEO Colin Cole, adding: “So it’s a big issue.”
Cole said Lioncourt’s 1,000 workers, mostly sub-contractors, are working at full capacity to deal with the existing workload.
“We will struggle to get the numbers of contractors to satisfy this demand,” said Cole, whose company is due to open its second-biggest housing site to date in the central English city of Worcester next month.
Lioncourt is aiming to increase its sales to 250 homes in the 12 months from March 2025 to March 2026, from 165 in the previous 12 months, and to 500 over the following five years, plans which pre-date the new government’s reform announcements.
CHALLENGES
Britain has long lacked candidates to fill jobs, a problem made worse by the 2016 Brexit vote and COVID-19, with vacancies higher than their level before the pandemic.
Its construction sector, as in many other countries, must also deal with many skilled workers nearing retirement age. The Construction Products Association predicts the sector is expected to lose 500,000 workers to retirement over the next 10 to 15 years, representing around 25% of the total workforce.
Cole said 65% of Lioncourt’s bricklayers are over 45 and around 45% older than 55. Less than 10% are aged 25 or below.
Industry experts and businesses say Britain’s education system is not providing the next generation of construction workers with the necessary skills.
Just one in four students completing full-time construction courses enters employment after finishing further education, data from the Home Builders’ Federations shows.
The government has announced 32 skills hubs to provide fast-track training for 5,000 more homebuilding apprentices a year by 2028 in trades such as bricklaying and scaffolding.
The Construction Industry Training Board – which represents infrastructure as well as homebuilding – said there were around 33,600 apprentices on longer-term training schemes in 2022-2023, short of the 50,000 needed every year to maintain activity.
One possible answer is for the sector to reflect the diversity of Britain’s population. The Chartered Institute of Building said just 6% of workers come from a Black, Asian or ethnic minority background, compared to 18% of the general public. Meanwhile, only 15% of the workforce are women.
IMMIGRATION?
Finding workers to do the building might force Starmer to find a way to reconcile his promises to reduce record levels of migration with employers’ needs.
“You could argue that overseas workers would actually be quite a useful lever here to help them build up the labour supply that’s needed,” said Ashley Webb, UK economist at Capital Economics.
Before Brexit, EU citizens had unrestricted rights to live and work in Britain. Firms now say the system to sponsor European workers makes it extremely difficult to fill shortages.
Steve Turner, executive director of the Home Builders’ Federation, said the process for employers to sponsor foreign workers was not working, even after the previous Conservative government relaxed immigration controls for some construction roles including bricklayers, electricians, and carpenters.
“Housebuilders are not using the system at all because it is too complex, time-consuming and costly,” Turner said.
The government says it wants to train people already in Britain, to reduce dependence on foreign workers.
“We’re not looking at easing restrictions, but we will be reliant in part, partly as a result of the change made by the previous government, on some foreign workers,” housing minister Matthew Pennycook said on Thursday.
“We’ve got to do more to train and skill up our own people to work in this industry,” he told LBC radio.
