Alastair Hamilton, partner at Pick Everard, discusses the current lay of the land and shares his insight into the challenges on the horizon for the construction industry
The start of any new year is a time of reflection for businesses, while also looking ahead to what the next 12 months may bring. While we often see a chance to ‘wipe the slate clean’, the pandemic of the past two years has left a mark that is still visible and continues to impact much of our progress. Between lockdowns, shortages, and rising inflation, it’s no wonder the construction industry is still nervous and uncertain about the future. We can expect this to continue and potentially even worsen into this year until the market rebalances.
However, on a more positive note, there have been great successes and the difficulties have forced our industry to rethink how it can work better, resulting in new innovations that build a better future for not only for those working in the sector, but everyone who benefits from what we create.
Delays and demands
It is no surprise that the shortage of skills, staff and materials coupled with the pressure of inflation has posed a major challenge to the industry. Together with continued uncertainty around the pandemic itself and ever-changing guidance around isolation, this is something that will likely continue this year, but in time will hopefully level out in line with the market.
The construction materials shortage is easing, and some materials have started to return to more manageable levels as the demand for maintenance and improvements tapered off towards the end of last year. But, long lead in times and further price increases are expected in 2022.
Meanwhile, with the continued high demand for the housebuilding expected to continue into 2022, there are still problems being reported on roof tiles with long lead times up to 10 months, and the price of clay tiles increasing with the hike on energy bills. with reported shortages of other materials including cement also affected by energy cost increases and concrete – plus British Steel has raised the price of steel has been by another £50 per tonne.
The Construction Leadership Council (CLC) also reported that it will take another year for the UK to be able to address the shortage of bricks. Imports from Europe is a potential, as well as more brickmaking plants across the country to address this issue.
Elsewhere, the chaos at shipping ports has only slightly subsided, as delays look set to carry on for much of this year too. And with the pandemic causing widespread disruption, almost all large construction projects are behind schedule – a costly place to be. These are not standard delays either with some pushing as much as 250 days. In our efforts to move on from the pandemic, to ‘build back better’, find more sustainable methods of construction – we are being hindered.
Pandemic problems
While we have come such a long way since March 2020, it would be unwise to suggest that the pandemic is over. If we have learned one thing, it is the unpredictability of this virus. It is not determined by any one single thing – nor one country. So even as the UK shows promising signs of progress, relying so much on international movement in construction means we have to look at the data everywhere.
On top of how the pandemic moves is how we adapt with it, which has sparked worrying problems with peoples’ mental wellbeing and means that many of the processes we were so accustomed to before, no longer work.
The pandemic has adversely affected our mental health and productivity in the workplace, which is a huge concern and hopefully one that will not cause lasting damage. Our challenge is to ensure people continue to feel connected and that there are support networks and engagement at all levels to promote a safe and positive environment.
I do believe many of the ways we work will be forever changed – and likely for the better – as we become more efficient through digital means. But this uptake has been slow in construction, which is a challenge that we need to collectively combat. Modern technology is vital to cutting time and costs and moving forward with the world, and those companies that choose not to invest here will ultimately be left behind.
Environmental effort
Meeting the commitments that were made post-COP26 and taking clients on the journey to net zero is a mammoth challenge and needs a long-term and holistic approach to realise our collective objectives. It’s not something we can accomplish in 2022, but it has to start ramping up now to set the pace for the next few decades.
The discussions that have been happening around net zero are promising, and it’s refreshing to see the industry come together on this issue. Pick Everard is positioned as a leading consultancy in driving and working with the wider construction industry, our clients and our peers on that collective journey. It is our aim to achieve net zero carbon this year, via our Carbon Reduction Plan.
It is important that we continue to embrace issues facing the environment and delivering real and true, measurable social value in everything we do. By establishing consistent and effective methods, measures and targets, driving innovation in the industry and throughout its supply chains, we can start to deliver on our climate emergency commitments.
Responsibilities
Legislation continues to develop and place responsibilities upon us as built environment professionals. The Building Safety Bill, introduced in the House of Commons in July 2021, will place new regulatory and challenging responsibilities on building professionals that the industry must embrace and ensure it is able to manage its liabilities and achieve compliance.
The biggest shake up of building control will importantly ensure the industry prioritises the health, safety and welfare of building users and puts building safety fist.
There has also been the major stall to the rolling out of 11 smart motorway schemes, putting a multi-billion-pound project up in the air. This has ultimately come down to safety concerns, so again, while this will undoubtedly raise huge challenges for contractors, we must look at the bigger picture.
At Pick Everard, we strive to ensure our clients receive the best possible service to deliver a scheme with safety rooted firmly at the heart of every action taken. Our focus is to assist and provide specialist construction health and safety support, ensuring legislative and statutory compliance requirements are carried out.
It is also important to acknowledge worker safety within construction, as another responsibility the industry needs to keep on top of. We have seen the impact of sickness and absence on our work, the cost to a project is steep. While not always avoidable, there are certainly ways that can ensure health and safety risks are managed, boosting training with workers and creating strong safety programmes.
Equally, mental wellbeing of employees must be a central focus. It is well known that the construction industry has for a long time seen much higher levels of poor mental health among workers, driven by a number of factors. With mounting pressure on many projects thanks to shortages and delays, it is imperative that we examine and alleviate any negative mental impact on everyone working within the sector.
Hope for the future
The forecast for the UK Construction Industry for the next couple of years is very positive. Even with the disruptions that have been faced, we should be optimistic that the workload should continue to be buoyant, and we should continue to see growth. Towards the end of 2021, experts were reporting a jump in construction output that we should feel positive about.
I expect to see greater public sector investment to be a major driver for construction growth over the next two years, in particular the government’s pledge to significantly increase investment in the UK’s infrastructure.
Our clients will continue to focus on built assets that use less energy and resources to reduce their energy requirements and help achieve their zero carbon aspirations. Procurement strategies that facilitate early and effective engagement with supply chains to source the right materials and solutions from sustainable and low carbon sources will be vital to successful low carbon project delivery.
In spite of some difficulties, these challenges are what makes our industry better – and 2022 will be a year of great achievement for us all.
