The Building Cost Information Service (BCIS) has called on Labour to address the skills shortage in the construction industry via migration in the short-term.
The government plans to boost vocational courses to upskill UK workers, rather than relying on overseas workers.
However Dr David Crosthwaite, chief economist at BCIS, said: “The degree to which Labour can support migration in the short-term at least, in order to meet the immediate needs of the construction industry, while also working on the longer-term ambition to grow the skills base in the UK, remains to be seen.
“In an ideal world you would be able to deliver projects with a pool of locally available labour, but that hasn’t been the reality in the UK for some time, and it’s not what the industry has experienced throughout its history.
“The new government’s plan to boost vocational courses will take time to get workers on site and we’re short by hundreds of thousands, taking other sectors into consideration alongside housing. What the government decides to do with the Immigration Skills List and how it responds to the increasing reports of shortages in various sectors will be crucial.”
BCIS said the UK had lost the European labour it had relied on post-Brexit, while the domestic workforce had declined since the pandemic.
At the same time, demand has also reduced as the industry has been hit by successive shocks since Covid-19 – rampant inflation, sustained high borrowing costs, conflicts in eastern Europe and the Middle East.
Currently construction demand is down, but once it rises the lack of workers will become more apparent.
Part of Labour’s plan is also to ensure the minimum wage is a genuine living wage. It also said it will change the remit of the independent Low Pay Commission to account for the cost of living and remove age bands, so all adults are entitled to the same minimum wage.
BCIS points out this alone is probably not the incentive that will lure droves of young people into construction apprenticeships.
More specifically, Labour’s main method to boost further education and apprenticeships is to establish Skills England, a body that will bring together businesses, training providers and unions with national and local government to ensure there is a workforce to deliver the Industrial Strategy.
The new government has also promised to transform Further Education colleges into specialist Technical Excellence Colleges, which will work with businesses, trade unions and local government to provide better job opportunities. In place of the Apprenticeships Levy, it said it will create a flexible Growth and Skills Levy, with Skills England consulting on eligible courses to ensure qualifications offer value for money.
Dr Crosthwaite added: “Aligning the needs of the industry with education provision is sensible but there’s an unavoidable lag from getting more young people into apprenticeships to getting them on site.
“Even the establishment of Skills England is set to take place in phases over the next year. We absolutely need a long-term plan, but the government can’t ignore what’s right in front of them now.”