Fear of skills shortage in construction

Surge in activity in the construction sector sparks fears of skills shortage

Rui Vieira/PA Wire General view of construction work
General view of construction work

A fresh surge in construction activity has fuelled concerns that there are not enough skilled workers in the UK to keep pace with expansion.

Headline figure for the Chartered Institute of Purchasing & Supply’s (CIPS) August survey on construction showed a bigger-than-expected jump to 64 from 62.4 in July - one of the sharpest rises in output for seven years.

The boost is being driven by the recovery in housebuilding but CIPS chief executive David Noble is worried the construction sector’s longest run of employment growth since the recession is revealing a major skills shortage.

He said August saw the quality of sub-contracted work deteriorate at the fastest rate since the survey began in 1997, alongside a record reduction in the availability of sub-contractors and a record rise in the rates charged.

Across the supply chain, delivery times also saw the sharpest rise since the survey began, with input prices growing at the fastest rate since July 2011.

Mr Noble said: “The sector is struggling to find enough skilled tradesmen to keep pace with new work and the labour market will continue to put pressure on costs until the next wave of apprentices begin to enter the jobs market.”

CIPS said residential construction posted the fastest rise in activity in August, despite the pace of expansion moderating slightly to a three-month low.

Civil engineering activity increased at the strongest pace since March, while growth in commercial construction was again near to its fastest since the summer of 2007.

CIPS said construction firms remain “highly upbeat” about the prospects for growth over the year ahead, with more than half of respondents expecting a rise in business activity and only 7% forecasting a decline.

However, the latest data also indicated a sharp and accelerated increase in average cost burdens across the construction sector.

CIPS reported that the rate of input price inflation was the fastest since July 2011 as suppliers sought to re-establish margins.


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