Optimism is up in construction, which is a refreshing change from the pressure the industry has been experiencing in recent years. Increase building activity and main contractors returning to profit, makes a nice change from liquidations and cancelled projects.
A recent Arcadis report predicts that inflation is set to ease up in construction and particularly in road and rail infrastructure. Though, with demand and scarcity remaining a challenge in the water and energy, things are not as rosy there.
While on the subject of demand and scarcity, there’s an inflationary factor that should not be overlooked. Not that we’re try to ruin the optimism, but the skills gap is a reality that we’re not close to solving yet.
In an ideal world the opportunities in construction would create local employment. The challenge is that industry has not been able to attract sufficient talent to build up a future pipeline of skills for an expanding industry. The situation has worsened by senior professionals retiring and immigration laws tightening.
Historically, the UK sourced labour from overseas, both for trades and artisans as well as specialists. This has become harder with new immigration laws, despite government making some concessions towards construction in recent years.
With these factors combined, top talent is in short supply and high demand. As the Arcadis report subtlety mentions, inflationary pressures are likely to increase due to labour costs. It’s a bit of a damper on the much-needed optimism. Is there a way for companies to turn this around?
It may sound over simplified, but hiring right could go a long way to reducing labour costs in the longer term. Mostly because hiring wrong is what costs companies up to 6 times more in lost revenue, onboarding costs and re-hiring. When the role is well defined and the specific skills gaps identified, the search can be refined. Tapping into a network of construction professionals, it’s possible to access more suitable candidates that are open to new opportunities – even if they aren’t actively looking.
These are candidates that know the industry inside and out, professionals that consistently deliver value to the companies they work for. They are people worth stretching budgets for, because they get the job done. At the same time, they expect companies to understand and reward the value they deliver.
Closing the skills gap is intrinsically linked to how well the construction industry will be able to leverage and build on existing resources. Finding the right people for the job is a vital part of this.