Labour shortage & supply chain issues in the construction sector

The UK construction industry is facing a series of challenges causing problems for firms big and large. First, there was COVID-19 which forced workers to isolate themselves. Hot on the heels of that crisis came another: labour shortages and higher materials costs driven by Brexit.

These problems are further fuelled by an age-gap crisis. The average tradesperson in the UK is 50 and the industry is struggling to attract new talent that might otherwise have helped it fill gaps caused by the pandemic and Britain exiting the European Union.

How have these setbacks affected such a pivotal sector and how have contractors adapted and recovered?

1. How has COVID-19 affected the construction sector?

Even as recently as August 2021, workers who’d been in contact with an infected person were forced to isolate for 10 days. This made it harder for contractors to complete projects on time – because they had no guarantee their tradespeople would turn up for work.

Although the industry is rallying around – (workers are no longer being pinged and strict COVID-19 protocols have been rolled out industry-wide) – it’s still got some catching up to do. The recent skills shortage meant many important projects were put on hold and, in some cases, cancelled.

A skills shortage still exists even now, threatening to unbalance this welcome period of economic recovery. Tradespeople who were unable to work – due to projects being rescheduled or stopped altogether – jumped ship to other more prosperous sectors. And it remains to be seen how that void will be successfully filled.

Although Brexit is partly to blame for the supply issues plaguing construction, COVID-19 has played its part too. Material shortages previously impacted building schedules, causing disruption within the supply chain that lead to many projects being postponed or shut down entirely.

2. The effect of Brexit on materials and skilled labour 

It was only last December when Britain agreed on a post-Brexit trade agreement with the European Union, signalling the end of a long-term partnership that began in 1993. But the construction industry has had to face numerous other challenges prior to Brexit – including, but not limited to, COVID-19, labour shortages, and the collapse of the industry giant Carillion.

The impact on workers 

The recent ‘pingdemic’ forced construction workers who’d been in contact with infected individuals to isolate themselves. This led to projects being put on ice or shelved entirely. In retaliation, many tradespeople migrated to other sectors where they had a greater chance of making money. 

The changes to the freedom of movement act which came into force when the UK broke away from the EU didn’t help matters. The new points system will restrict general labourers, meaning contractors won’t be able to draw from the same resource pool. If the demand for workers rises but can’t be met, the costs of construction projects will inevitably arise.

Materials & products

When COVID-19 retreated, Brexit boldly stepped forward and took its place. Newly introduced measures saw restrictions being placed in terms of how goods moved between the UK and EU destinations. This red tape led to increased customs checks, conformity assessments, and stringent limitations in terms of which products could or couldn’t be transported.

This heavily bureaucratic approach has thrown a proverbial spanner in the works – slowing down progress at a time critical economic juncture. As if that wasn’t bad enough, the costs of materials have skyrocketed as a direct result of these unacceptable delays.

Procurement legislation

Procurement within the construction industry hasn’t escaped unscathed either. True, the EU Procurements Directive remains in place – but the sections pertaining to UK regulations have undergone a drastic overhaul. These changes mean contractors could find themselves exposed to higher costs, longer delays, and other unwanted penalties.

Construction companies should carefully review any contracts they use to check their exposure to risk while bearing in mind changes made to the EU Procurements Directive. Factors to consider could include force majeure, changes to the law, and dispute resolution provisions. This list isn’t limitless and advice should be sought from a legal specialist before making changes to contracts.

Mitigating risk during these challenging times 

Better collaboration – more comprise

So what can the construction industry do to recover from recent problems caused by COVID-19 and Brexit? Contracting parties collaborating on important projects will be keen to avoid unnecessary delays and risks. This will lead to better cooperation and more compromise – with involved parties working together to agree on mutually beneficial deals.

The rise of cloud-based systems

Brexit and COVID-19 all but brought the construction sector to a standstill. Companies that had failed to invest in cloud-based software were hit the hardest, with some disappearing from the map entirely.

To remain agile, competitive, and appealing to prospective customers, construction firms must invest in new technology designed to give them 360-degree visibility, minimise external site visits, and provide real-time insights so that trends can be spotted sooner rather than later.

Is your documentation in order?

Creating important documents like health and safety files, scopes of works, and O & M manuals shouldn’t take up vast tranches of your time. That’s where a system like Dokkit comes in.

Go digital with your documentation and you’ll be able to create files from day one and import values automatically. Your sophisticated cloud-based software will also give you the power to create bespoke templates for specific file types (which can be branded to create better first impressions).

Digitising your document should form part of your post-Brexit and COVID-19 strategy. If you haven’t made that switch yet, now’s the time to learn more by taking the next step.