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Skills shortage at breaking point

Scape Group releases most comprehensive survey of construction supply chain

Posted by Stephanie Broad | August 22, 2016 | People, policy, politics, money

Scape Group, the public sector owned built environment specialist, has carried out the most comprehensive survey of the UK’s construction supply chain and revealed the true extent of the skills crisis.  

The Sustainability in the Supply Chain report, which surveyed over 150 contractors, subcontractors and senior managers at public sector organisations, also examined supply chain stability, the tendering process and reliance on the public sector.

Skills shortage at breaking point

The report highlighted the stark realities of the skills shortage, with 58% of contractors and suppliers citing the shortage as negatively impacting the quality of their workmanship. This sentiment was amplified in the public sector, with an overwhelming majority (85%) of managers seeing the quality of their built environment projects negatively affected by the skills shortage.  

Over a third (35%) of public sector managers felt that the skills shortage was ‘bad’ or ‘severe’ in their area but it was SMEs who are noticing the problem most acutely – with 85% seeing a shortage in their area.

It is not just the quality of work which is suffering, 80% of public sector respondents and just under 40% of contractors and consultants see the skills shortage as negatively impacting their ability to keep to budget. With bricklayers in the UK earning as much as £1,000 per week due to the shortage of skilled workers, it is clear to see the crisis now risks destabilising the industry as a whole, indeed 42% of public sector managers highlighted it as one of the biggest barriers to a sustainable supply chain. 

Mark Robinson, Scape Group Chief Executive, comments: “Our research has shown that the skills shortage is at breaking point, not only severely impacting the quality of what we are building but also our ability to build it on budget. While there is a mountain to climb to overcome this challenge, basic recommendations can be put in place to ease the burden, for example, 19% of contractors and subcontractors still do not have an apprenticeship scheme.”  

Reliance on the public sector 

The public sector funds more than a quarter of the business for 64% of contractors and suppliers interviewed. When broken down further, it is clear that SMEs rely more heavily on the public sector, with over a quarter (26%) of companies stating it funded more than 50% of their work.

In the wake of Brexit, access to the public sector construction pipeline is more important than ever. During the 2008 recession private sector construction output dropped by 25% between 2008 and 2009 and it was the public sector which propped up the industry. 

Mark Robinson, Scape Group Chief Executive, continued: “Given the current economic uncertainty the £30billion of public sector construction activity is a vital stream of revenue for the sector and early signals from the new government that austerity measures might be eased would be welcomed across the board.” 

Scape Group’s recommendations are as follows:

  • Addressing the skills shortage, both in terms of apprenticeships and gender imbalances
  • Greater forward visibility of project pipelines to support SMEs, which is vital in generating long term financial security in the UK
  • Greater collaboration between the public sector and supply chain, to support efficient delivery
  • Communication of the importance of local spend and social value  

Rick Willmott, Group Chief Executive at Willmott Dixon, Scape’s partner on the Major Works framework, commented: “I am extremely proud of Willmott Dixon’s achievements through our partnership with Scape, our shared values have allowed us to focus not only on offering efficient and cost-effective solutions but also on adding lasting value to the local communities we work in. Our common focus on SME engagement and growth has seen us set and achieve challenging targets for local spend.  We are not complacent though and will continue to set a high benchmark that I hope will inspire other companies in our sector as we all use our economic influence to drive growth in the local supply chain.”

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