Fall in construction employment is a ‘real concern’, sector bodies say

A spokesperson for the G15 group of London landlords said: “These latest construction employment figures are a real concern. With the capital in a housing emergency and new starts already collapsing, we need urgent action to rebuild industry capacity and secure skilled labour.

“The £39bn investment in affordable and social housing announced at the Spending Review is an important foundation for recovery, but we need the workforce to build the 1.5 million homes the government has committed to.

“So, it’s encouraging to see the government stepping up with initiatives like the Construction Skills Mission and the commitment to recruit 100,000 more workers a year, alongside other measures aimed at getting more people into high-quality construction jobs.

“We also welcome the mayor’s inclusive talent strategy, which puts employers at the heart of London’s skills system. We’re ready to play our part in these partnerships, helping people from all backgrounds access training and good jobs.

Anne Waterhouse, vice chair of The L12 and chief executive of Wandle Housing Association, said: “These figures highlight that we are still in the midst of a housing crisis. The L12 are building, and are committed to providing much-needed affordable homes across the capital. 

“It is vital that we as a sector invest in training, development and skills for the future. As well as this, we must that ensure we highlight and promote the relevant opportunities to enable more people to choose these critical roles.

“As a group of community-focused housing associations, we have programmes which tap into our local neighbourhoods for our apprenticeships, jobs and talent pipelines. This helps to foster strong communities, reduce inequalities and create meaningful connections with the places we serve.”

With London’s housebuilding rates crashing, earlier this year the GLA and the Ministry of Housing, Communities and Local Government agreed to lower London’s target for the Affordable Homes Programme by more than a fifth. It is now between 17,800 and 19,000 starts.

Last month, the government set out further “emergency” measures to resuscitate the market, including a controversial move to lower affordable housing targets on developments.

Tanya Bass, policy leader at the National Housing Federation, said: “A skilled construction workforce is essential to delivering our housebuilding ambitions. Alongside welcome new policy reforms and funding, the government must work with the construction sector to train and recruit the skilled workforce needed.

“It’s also vital that plans to address skills shortages explore how we can make more use of MMC [modern methods of construction]. This would reduce housing associations’ reliance on traditional skilled trades, future-proofing delivery against skills shortages and creating job opportunities for those with different backgrounds.”

Earlier this year, the House of Lords Built Environment Committee heard why a clear demand pipeline is needed to address skills gaps in the construction industry.

John Bowker, chair of JV North, said: “The latest figures are unsurprising. Eighteen contractors collapsed in the North West over the course of the current 2021-26 Affordable Homes Programme with a subsequently negative impact on sub-contractors down the chain.

“It is an ageing workforce, so when contractors enter administration, many leave the sector either to retire or [because they] want a change and to find alternative employment. Construction has slowly but significantly changed in the last couple of decades.

“Many small and medium-sized contractors now operate as project management companies more than contractors, as they do not directly employ large numbers of people but sub-contract work when needed.

“Despite this, there are currently enough people employed in the North West [for there to be] no impact on our development work.

“We are still building our target of two new homes every working day in the current Affordable Homes Programme, with over 3,000 more [planned] in the next four years.

“To safeguard ourselves and reflect the current market conditions following this downward trend in construction employment we changed our relationship with contractors.

“Over 12 months ago, we made a concerted effort to make contractors feel more valued as key partners, instead of the traditional client-supplier relationship focusing on narrow economic goals. We have given more leeway on construction terms and share more risk. 

“In turn this will make contractors healthier businesses that can then invest more in apprenticeships, training and recruitment – the latter of which we feel the construction industry could make more appealing.

“Construction has many advantages that will appeal to large numbers of people but currently it doesn’t shout loud enough about the benefits, such as being part of a team, human interaction, the rewarding experiences that come from creating homes which make a difference to peoples’ lives, and varied, fulfilling careers.

“All of which are in complete contrast to the often lonely, isolated experience of working from home found in many other sectors, so there is a market that can be tapped into.” 

Last year, Inside Housing launched its Housing Hires campaign to promote the social housing sector as a place to work and support people in finding jobs and developing their careers.