Thursday 6 November 2014

UK Infrastructure ambitions in jeopardy unless skills shortage addressed, says LCCI / KPMG report

With 20% more workers required to meet the pipeline of around £96 billion of construction projects in 2014-17, the London and South East is facing a major skills crisis. This could impact the wider economy as early as April 2015, when a total of over 600,000 workers will be needed on site to deliver major projects currently in planning, according to a new report by London Chamber of Commerce and Industry (LCCI) and KPMG.

The Report, 'Skills to build', outlines the labour requirements to deliver construction projects in London and the South East between 2014 - 2017 and the gaps in training that must be filled to meet this demand.

The industry has experienced great difficulties in recruiting enough skilled workers, for both professional roles and manual trades, to keep pace with new work. According to the report, a 51% increase in training provision would be required to meet demand for skilled labour between 2014 and 2017 to plug a gap of nearly 15,000 people.

Unless the supply of construction labour is increased, house building targets will not be met and the delivery of large infrastructure projects will be jeopardised. With 255,000 workers needed on site to deliver the 2015 pipeline of housing and 400,000 of the workforce expected to retire in the next 5-10 years, change to the industry has never been more pertinent.

The report includes the following recommendations to help fill the skills gap:

• Infrastructure UK should drive a commitment to embed skills and employment requirements in public procurement contracts, aimed at both Tier One contractors and suppliers.
• Government should ensure schools provide obligatory, quality and unbiased careers advice from Year 7, and submit annual careers reports evaluating the range of careers and training options covered.
• Local authorities should maintain and share a pipeline of future projects, with skills responsibility and funding devolved to the most appropriate level of functional economic activity, to enable the commissioning of demand-led training provision.
• The Skills Funding Agency should convene industry bodies and representatives to redesign training and apprenticeship frameworks to reflect modern methods of construction, and disseminate them for adoption by training providers.

Richard Threlfall, KPMG UK Head of Infrastructure, Building and Construction said: "For the first time in many generations, the UK has a strong pipeline of construction and infrastructure projects to reinvigorate the economy and drive our future competitiveness. But delivery of that pipeline is now in jeopardy - not for lack of political will or funding - but for lack of a sufficiently large and trained workforce. Unless action is taken now, our housing targets will be missed, and infrastructure projects delayed.

"This report calls on the industry itself to wake up and take responsibility to increase levels of training dramatically. It also calls on Government and training providers to recognise that the industry is changing, with ever greater application of technology and a trend towards offsite manufacturing - the skills required in the industry tomorrow will be very different from the skills required today. And above all it calls on all in the industry to take steps to boost the image of the construction sector as an attractive career path for the next generation in our schools and colleges.

Colin Stanbridge, Chief Executive of LCCI said: "Our members have long spoken to us about their difficulties recruiting sufficiently skilled workers. The detailed findings of this report highlight just how grave skills shortages are in the construction sector, with significant deficits of capable workers across numerous trades and professions.

"Our task now is to enact changes to address the inherent issues which have led to the construction skills crisis we face. We are delighted to have partnered with KPMG on this report and look forward to working with government, training providers and industry alike to implement the solutions suggested."

ENDS

Media Contacts

KPMG Press Office: 020 7694 8773

Jo Hooper, London Chamber of Commerce and Industry
(T) LCCI Press Office: 020 7203 1897

NOTES TO EDITORS:

1. The Skills to Build report can be found here
2. Richard Threlfall and Colin Stanbridge are available for interview and further comment
3. About LCCI: London Chamber of Commerce and Industry (LCCI) is the capital's largest and most representative business organisation, with members ranging in size from multi-national companies to SMEs and sole traders.
4. About KPMG: KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 11,500 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2013. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 155,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.