Credit crunch hits forecast construction job opportunities

The UK's current economic downturn has seen the annual requirement for new construction staff halve, according to new figures. However, despite fears in some sectors of the market, the industry will continue to grow over the next few years according to the forecast from the Construction Skills Network (CSN).

The CSN, which reports on the numbers of new industry recruits needed to satisfy growth, shows that a slowdown in the housing market and related sectors has reduced the requirement from the previous average of 88,000 per year to 42,000 per year between 2009-2013. From the previous forecasts produced at the end of 2007, this is a total fall of 184,000 new recruits needed by the industry over 4 years.

The figures, which are usually published every February, were re-calculated to provide an interim indication of the impact the credit crunch is having on the construction sector's skills needs, based on changes to official data and feedback from the Network's experts around the country.

However, the forecast also reveals that, despite fears in some sectors of the market, the industry will continue to grow over the next few years. Between 2009 and 2013, UK construction is expected to expand by 0.7% annually, thanks to high-value projects like the Olympic Park and the Thames Gateway re-development, and continued public sector investment in services and facilities such as roads, schools and hospitals.

The new forecasts indicate significant sub-sectoral differences, for example infrastructure is still showing very strong annual average growth at 6.5% to 2013. This is in contrast to the 0.3% growth for private housing. These differences have contributed to the stark change in requirement for new recruits, with infrastructure being far less labour intensive, so requiring fewer new entrants to deliver planned projects.

Sandra Lilley, Manager of the Construction Skills Network, said: "The current economic climate provides challenges to every business sector, and construction is no different.

"But, despite some high-profile redundancies recently, our growth predictions remain strong and in line with industry and Government forecasts. The fact is that we still need over 40,000 new entrants to the industry every year to fulfil some big projects, and that's a significant requirement."

Longer-term predictions denote strong growth for UK construction. The "2020 Vision" report resulted from a recent research project conducted by ConstructionSkills, the industry's Sector Skills Council which co-ordinates the Construction Skills Network. The report demonstrates that despite the possibility of a prolonged economic downturn, construction activity is set to increase in the long term. By 2020, the industry could be worth a £109.2bn in 2000 prices, which is a 31% increase in real terms over the 2007 level[1]. It also highlights future skills trends, including the continuing demand for specialist workers over the next decade to accommodate changing construction methods and practices.

Mark Farrar, Chief Executiveof ConstructionSkills, added: "The indications are clear that the construction industry will continue to flourish in the long-term, and that the workforce will expand beyond the current number of 2.5 million.

"We advise firms to continue training their employees, as this will ensure they have a safe, professional and qualified workforce, putting them in a stronger, more competitive position to win and retain contracts. Businesses should protect and seek to improve the quality of their workforce to mark themselves out to potential clients. Past experience also shows that some of the experienced workers leaving the industry tend not to come back, and should this happen it may cause major problems for the country to deliver much-needed affordable housing, schools, hospitals and roads."

To help preserve the industry's young apprentices in the economic downturn, ConstructionSkills has worked with the Department of Innovation, Universities and Skills (DIUS) to offer practical solutions to the industry. A Construction Task Force has been established to offer support to businesses in maintaining their training levels for apprentices, while a ‘Clearing House' system has also been set up to find new placements for those facing redundancy.