Paul Groves looks at key shortages facing the construction industry and asks whether it could scupper the record growth seen so far in 2021.

From Glenigan to the ONS, industry surveys are pointing to a remarkable upswing in performance for construction in the first half of 2021.

Despite coming to a literal standstill at times during the last 18 months, the industry has shown resilience in fighting back and taking advantage of Government easing lockdown restrictions at particular times,

There have been record rises in project-starts and output in construction in 2021, matched by a similarly buoyant picture from product manufacturers too.

But talk of recovery is increasingly being tempered by warnings that this growth could be brought to a shuddering halt by shortages in two key areas – workers and materials.

Through the Construction Leadership Council, the Construction Products Association and Builders’ Merchants Federation are issuing regular updates on the significant shortages being experienced in key areas – there are worrying short supplies of timber, roof tiles and some steel products, for example.

Similarly, the Construction Industry Training Board has warned that by 2025, the industry will need to recruit an additional 217,000 new workers just to meet demand.

Could these key shortages scupper constructions record growth?

Paul Groves Paukl Groves Editor of Specification magazine

Building back better?

The Government is now facing calls to channel its energy in these areas as it continues to trumpet construction as a cornerstone of its attempts to “build back better”.

Such lofty building targets are admirable, but not much use if there are insufficient materials and products to complete projects or indeed skilled workers to create developments.

Indeed, research by the Office for National Statistics states that the employment rate in the construction sector for the UK fell from 2.3 million in 2017, to 2.1 million at the end of 2020.

This demonstrates a 4% decrease in UK-born workers, and a 42% fall in EU workers.

In London, employment fell from 311,124 workers in 2017, to 261,271 at the end of 2020, representing a 54% fall in EU workers, which has only led to further difficulties considering the construction industry was relied on heavily during the pandemic.

New approaches needed

CITB Policy Director Steve Radley said: “It’s great to see construction coming back so strongly and creating lots of job opportunities. We need to adopt new approaches to meet these growing skills needs and deliver these quickly.

"We are working closely with government and FE to build better bridges between FE and work and make apprenticeships more flexible. We are also making significant investments in supporting work experience that make it easier for employers to bring in new blood.

“We must also make sure that we invest in the skills that will drive change and meet new and growing needs such as Net Zero emissions and Building Safety. We will be announcing plans soon to tackle specific skills and occupations such as leadership and management, digital skills and skills related to energy efficiency.”

Demand outstrips supply

Meanwhile, demand both in the UK and globally for construction materials and products continues to dramatically outstrip supply and shows few signs of slowing during the seasonally busy summer months.

In the UK, record sales of building materials coupled with strong pre-orders and full pipelines of work are all putting enormous pressure on the supply chain which, in some sectors, has not fully recovered from the impact of Covid.

This suggests the unprecedented challenges around a number of key product areas, particularly imported products and materials, will likely persist into the second half of 2021.

Elevated prices

In their latest product availability update, John Newcomb, CEO of BMF and Peter Caplehorn, CEO of CPA, co-chairs of the Construction Leadership Council’s Product Availability working group, warned: “Inevitably, all of this is feeding into price inflation, and the expectation is that high demand coupled with tight supply will sustain elevated prices throughout the year.

“As we emphasised last month, forward planning and ongoing communication throughout the supply chain is essential to assist with reliable delivery dates and to manage expectations about any shortages or allocations.

“Allocation systems should be as transparent as possible, so all customers can be seen to be treated fairly and provided with both the information and the products they require to plan and complete projects in a timely manner.

“Builders and contractors should also maintain open communications with their customers regarding lead times, possible product substitutions and early notice of potential price increases.”

So, can the boom times be sustained? That remains the key question facing the industry.

After battling a global pandemic, it is now two very basic problems – a shortage of workers and materials – that could still scupper the record growth seen so far in 2021.

Paul Groves is editor of Specification