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The Building Cost Information Service (BCIS) has called on Labor to address the construction industry’s skills shortage through immigration in the short term.
The government plans to boost vocational courses to improve the skills of British workers, rather than relying on overseas workers.
But Dr David Crosthwaite, chief economist at BCIS, said: “It remains to be seen to what extent Labor will be able to support immigration, at least in the short term, to meet the immediate needs of the construction industry while also addressing the longer-term goal of expanding the UK’s skills base.”
“In an ideal world, projects would be able to be delivered from the pool of locally available labour, but that hasn’t been the reality in the UK for a long time, nor has it been what the industry has experienced throughout its history.
“The new government’s plans to ramp up vocational courses will take time to get workers into the field, leaving a shortage of hundreds of thousands of people when considering not just housing but other sectors as well. What to do with the migrant skills list and how to respond to growing reports of shortages in a range of sectors will be key.”
BCIS said the UK lost the European workforce it relied on after leaving the EU, while the domestic workforce has declined since the pandemic.
At the same time, the industry has been hit hard by a series of blows since the COVID-19 outbreak, including a surge in inflation, high borrowing costs and conflicts in Eastern Europe and the Middle East, which has led to a decline in demand.
Currently, construction demand is declining, but as demand increases, the labor shortage will become more pronounced.
Labour’s plans also include ensuring the minimum wage is a truly living wage, changing the powers of the independent Low Pay Commission to take into account the cost of living and removing age categories so that all adults are entitled to the same minimum wage.
BCIS points out that this alone will not be enough to motivate large numbers of young people to take up construction industry apprenticeships.
More specifically, Labour’s main initiative to promote further education and training is to set up Skills England, a body that brings together businesses, training providers and trade unions with national and local government to ensure there is a workforce to deliver the industrial strategy.
The new government also promised to transform further education colleges into colleges of specialised skills and excellence and work with businesses, unions and local authorities to provide better employment opportunities. The government will create a flexible Growth and Skills Levy to replace the Apprenticeship Levy and said Skills England would consult on eligible courses to ensure qualifications are value for money.
Dr Crosthwaite added: “It is sensible to align education provision with industry needs, but there will inevitably be delays between taking on more young people as trainees and sending them out into the field.”
“The set-up of Skills England will also be phased in over the next 12 months. Long-term planning is absolutely necessary, but the Government cannot ignore the challenges ahead.”