Closing the skills gap: Part 1 - Schools and their influence

As I have discussed in previous posts, the construction industry skills gap is something that at some point will affect us all. Previous figures suggested there are 182,000 construction jobs to be filled and importantly, this is not taking account of new projects either announced or on the horizon. With projects such as Hickley Point C already affecting labour available for current projects and the announcement in the Autumn budget of major infrastructure projects going ahead to support the planned increase in housing, such as Crossrail 2 and HS3 in addition to the planned Heathrow expansion, something needs to be done urgently.

I wrote before that an immediate solution for this would attracting millennials as there is a general lack of interest from this age group in the industry. They could be key to filling the void in the short term if we could engage with them. However, for a long term solution, we need to look to a younger generation, to primary and secondary schools for a source of future labour. Research shows that those who have a family member or people close to them working in the construction industry are significantly more likely to take a job in the Built Environment. Those with no connections are very unlikely. So how can we change this?

We need to look to students still at school. Reaching children who have not made their minds up about a career and therefore their academic route - GCSE choices, A-Level choices, BTECs etc or even apprenticeships - could be the difference as to whether they are able to enter the industry easily or not and it is far more likely that they would if they didn't need to go back to school to get required qualifications. The main issues seem to be a lack of knowledge of what career options are available in construction, a lack of interest in the industry, and a pre-conceived idea of what working in construction is like. The problem with these 3 issues is that there is little engagement between the industry and schools to change this. Whilst the industry talks about it, they don't do that much, and schools are no better, saying they want to be involved but in reality do not promote the construction industry as a good employer and on the whole do not engage with construction employers.

Organisations such as BESS Programme and Class of Your Own have been set up and fully engage with schools, pupils and the construction industry. BESS - Built Environment Skills in School is a project which aims to inform pupils in school and further education about the opportunities available to them in the Construction industry. The programme recognises the issue of the skills gap in the industry and is seeking to address this but it can not be left to one or two organisations to deal with whilst the industry sits back and just talks about what can be done.

We, in construction, have a responsibility to ensure that we inspire the next generation so that we can ensure the skills gap closes. If we continue to only discuss and not act, the number of construction jobs that needs to be filled will continue to rise well above the current level of 182,000. However, what is clear is that it is not just a lack of action by the construction industry, but also a lack of engagement by schools and a lack of knowledge and understanding of students and their families who are likely to be the ones giving careers advice. It is vital that schools are more pro-active and give pupils options, but it is equally important that they have access to material and resources in order to do this.

There are easy ways to engage with this generation through organisations such as BESS who. If you would like to get involved with the Built Environment Skills In Schools Programme, you can follow them on Twitter @BESSprogramme and visit their website to create a 90 second career video that will be used to inspire the next generation of construction professionals. Find more info at http://www.beskillsinschools.co.uk/home-page/get-involved-2/

The Autumn Budget 2016 and the UK Housing crisis

Wednesday's budget has a number of implications for the construction industry in areas including much needed housing and improvements to the transport network throughout the UK. However, will these announcements have the positive impact on the UK housing crisis we have been hoping for?

The Government has announced it will build 40,000 new affordable homes. But what does this actually mean? Whilst 40,000 homes may seem like a lot it will actually be an overall reduction of approximately 13,000. According to the Office for Budget Responsibility (OBR) as a result of Wednesday's budget, house building is now likely to slow. There are a number of announcements that will result in house building increasing, but with others causing a slowdown, the overall result will be a fall of 0.2% in residential investment growth.

The OBR continued to say the announced £1.4bn increase in grant funding for affordable house building would partly offset the fall, in addition to the disposal of public land commencing sooner which in turn would bring the construction of 10,000 homes into the forecast period. However, this will not necessarily increasing funding overall. The real issue here is that the wording suggests a substantially large number of houses will be built but the reality is that the governments target of 1 million homes by 2020 is getting further and further away.

The first policy announcement relating to Housing was that Housing Associations will be able to spend grants on building homes for rent. The £1.4bn that is being made available for affordable housing will be given to Housing Associations, however, the plan is that Local Authorities bid for a proportion of this fund to put towards affordable rent, shared ownership schemes or rent to buy schemes

The second was that mandatory “Pay to Stay” measures will stop and therefore will no longer mean increased rents for higher income council tenants. This is an interesting one as previously those who earned £60,000 or more could be charged market rate rent if they lived in social housing, if the landlord decided to. It was then suggested that it would become mandatory for those who earned £30,000 (or £40k in London) to pay market rates for rent. It has now been confirmed that it will not be happening, and left to the discretion of the Local Authority. However the government is looking at ways to ensure that those on higher income contribute more to social housing. So what does the removal of the Pay to Stay policy mean for UK Housing stock? In reality, not a lot. It will simply mean a reduction in revenue to fund discounts for the right to buy scheme.

In addition to these policies, there will be a £3.15bn fund to build 90,000 new homes in London. Again, this sounds great, but these will be built over a long period of time, with no exact timeframe determined. The good news is that a priority for this money is to make housing available to low income families at a below market rent, as well as properties with rent restricted to one third of the average income of a typical middle income family.

Additional funding and house building policies aside, the government has not changed the tax rules around buy to let properties and mortgage relief, however it has decided to remove estate agent fees completely. This will mean two things. Firstly, with no change to the tax relief on second homes, less people are buying properties for the purpose of buy to let. The benefit of this is that there is a larger supply of property for those trying to get on the ladder, however this is obviously if a) they can afford the deposit and b) if they can get a mortgage - two key points that are often skimmed over by the Government. The drawback here is that for those that can not afford to buy, there will now be a smaller pool of rental properties on the market. Secondly, the scrapping of estate agent fees is likely to be a good thing for renters not having to pay for contracts to be printed however we should note that these costs are likely to be passed on to landlords and in turn, to renters in the form of increased rent.

All in all, it is good to see more funding to being allocated to housing but the reality is that there are less houses being built than previously forecast and if it continues in this way the government will not hit their target of 1 million homes by 2020.

The uncertainty of Brexit and the impact it is having on the Construction Industry

With the headlines full of the recent ruling against the government in the latest segment of the Brexit saga (pre results of the US Election), I wanted to think about what it will mean for the construction industry and what it already means.

In the wake of the Brexit result, I was at a networking event where the main speaker touched upon Brexit - a topic people were keen to avoid in order to minimise the risk of an argument or upset. The speaker had one clear message for the industry: "We must not talk ourselves into a recession". So far, so good. We seem to be doing ok. There are mixed reports regarding the housing market but projects are going ahead and redundancies aren't widespread in the industry. Which is obviously great news, but with projects such as Hinckley Point C going ahead, the decision on the Heathrow expansion one step further, it should make us question where we are going to get the labour from in a post Brexit Britain. 

Whilst there is no immediate effect in terms of law and visa retrictions, EU migrant workers have started to move back home unsure of how the next few years will pan out. The result of this may be that we see a drastic change in the make up of the construction industry. The main concern around Brexit is that the UK may lose access to the single market, a key provider of construction labour. It is estimated that 15% of the current construction workforce is European labour.

A further shortage of labour, in addition to the pre-brexit figure of 182,000 vacant construction jobs, would likely mean a rise in wages across the industry. As I mentioned in a previous post, the rail industry has already seen huge wage rises due to shortages of workers and engineers building new lines and tunnels resulting in a staggering increase of 74 per cent between 2012-2015.

And its not only a shortage of labour that is affecting the Construction Industry. We are already seeing an increase in costs of materials as a result of the weak pound. Steel prices are on the increase, as are costs of any materials imported from abroad and this means now that any variations on existing projects are likely to cost the contractor and the client more as costs are passed on. The result being that projects risk going over budget and an increased risk of projects being put on hold.

This kind of wage increase in conjunction with the rising cost of materials and the projected flat lining of growth within the sector for the fourth quarter signals an increased likelihood of problems for the weaker players in the industry. However it is by no means all bad news.

The uncertainty post Brexit was thought to signal doom for the industry. However there are several positives to come out of it. 

 

1. Housing: Inward investment due to the weak pound means that UK property is cheaper to overseas investors, meaning there is still the demand for UK property not only from domestic buyers but also foreign investors. The housing market saw an increase in growth in the third quarter of 2016 which has propped up the industry as a whole. With the government falling behind on their target of 1 million homes by 2020, the autumn statement should provide the sector with the boost it needs to stimulate growth with announcements likely to include plans for more local authority house building as well as build to rent homes. 

 

2. Infrastructure Projects: With the confirmation of infrastructure projects such as Hinckley Point C and the Heathrow expansion as well as HS2 and Crossrail 2 in the pipeline, even more jobs are being created. Whilst there are issues around this because of a shortage of labour, this is still a significant boost to the construction industry with these projects said to be worth around £400m. This will be especially beneficial in the areas where HS2 and Hinckley Point C are going ahead for job creation.

 

3. Is there scope for a deal with the US in this new Trump era? Only last month, Trump representatives claimed Britain will be offered a free trade deal before the rest of the European Union if the Republicans win the US presidential election, which they have. As with Brexit, only time will tell what the outcome of trade deals between the UK and the US will be but depending where you sit, this could be good news.

 

There is no definitive answer as yet and it is unlikely that there will be for some time until Article 50 s triggered, negotiations get under way and eventually conclude. Until then, it is important to keep the words of the speaker in mind... "We must not talk ourselves into a recession".

 

To the women in Construction: Do you need to behave like a man to succeed?

I had an interesting conversation with an architect recently who I reached out to, to get a different perspective of what a career in the construction industry was like for a woman. When I asked her if she felt like there was a glass ceiling, she thoughtfully remarked "yes, but not in the way you would think". The woman in question explained to me how it worked at her firm, "it's a case of he who shouts loudest". The glass ceiling was not gender based as such but those who pushed hardest, noisily proclaiming how great they were and how much they wanted the job were the ones who got it. Although it was generally men, there were women who got ahead in this way and it was down to them adopting the behaviour that is typically associated with how men operate in the work place. If you don't play the game, you don't get the job.

The crux of the conversation was that she didn't believe the best talent was being nurtured and promoted by using this strategy. How can you capture those who were quietly brilliant at their job but either do not have the confidence to put themselves forward or it is not their style? By overlooking them and failing push them forward in favour of those people who are loud (and competent) and have an unfailing confidence to put themselves forward for jobs, firms run the risk of missing out on the best talent.

So is there anything wrong with this? You could say that if you want a job, you should go for it and if you aren't willing to sell yourself to an employer who will?

The reality is that men are a lot more likely to go for the job they want, regardless of whether they are qualified, than women. A study by LeanIn.org and Mckinsey & co. found that fewer women than men are aiming for the very top. Among senior managers, 60% of women said they want to be a top executive, compared to 72% of men. Women were also more likely to cite stress and pressure as one of the biggest reasons for not wanting to hold top positions.

Construction is one of those tricky industries where it still hasn't caught up and has a poor record of recruiting and retaining women, let alone promoting them to senior positions. However, as I have spoken about in previous posts, this is becoming more of a focus for firms as they realise they need to fill roles and women are the obvious source as they currently only represent 11% of the industry. The issue is there is still a perception that women aren't somehow suited to senior roles and as a result fewer women put themselves forward, or worse they are still overlooked.

So what is the solution? Do we as women need to change the way we behave in a male dominated work environment? The architect I mentioned earlier made me consider my opinion on this when she said, "behaving like a man doesn't mean we are equal to him, the reality is we're having to adapt ourselves to fit within a male industry and so we are not really any better off, we've just learned to play the game." And this I think is true. What we need is for the companies within the Built Environment to adapt and recognise that whilst the industry has been predominantly male, if this is to change the culture must also change to be more gender neutral. We need gender neutral competencies and behaviours, in order to attract the best talent to companies and into more senior roles.

In order to ensure we promote, develop and nurture the best talent within the construction industry it is important to recognise that different people need different things. Not everyone will shout about how great they are - you know it's just not very British!

 

 

Millennials: spoiled brats or key to the success of the construction industry?

Everyone knows there is a skills shortage in the construction industry. There are reportedly 182,000 construction jobs that need to be filled by 2018 and currently no real plan to achieve this. I touched upon it in my last post because given the male to female ratio in the industry it would seem crazy not to try and fill it with bright, capable, hardworking women. However there is another labour source currently not being fully engaged; Millennials. So this post will look into why millennials are shunning construction in favour of pretty much any other industry.

Millennials get a pretty bad rap. Defined as those born between 1982 and 2004, they are branded lazy, entitled, narcissistic with no work ethic and who can't commit - to a job, to a relationship, not even to a diet fad! But is this really fair? In the U.K. (and a lot of the developed world) we are facing the issues of an ageing population. In the construction industry specifically this means that more people are retiring but there are not enough people to replace them. And here arises the current issue of The Skills Gap.

The skills gap is an issue in the construction industry because whilst the economy is in good shape and the construction projects are plentiful, more and more people train in the trades and in the construction professions. In an economic downturn the construction industry is one of the first to go with funding disappearing and projects being put on hold. Therefore people leave because there is not enough work and move to other industries, rarely coming back. Just look at the shortage of Bricklayers and Quantity Surveyors as an example. 

The issue is this, Millennials, the next generation of the UK workforce are simply not interested in the construction industry. They perceive it as slow, outdated and traditional which when compared to industries such as Tech, which are are fast paced, agile and innovative it is easy to understand why construction is rarely first choice.

So what can we do to attract millennials to the industry? 

1. Embrace new technology. There are so many technological advances that can bring construction into the present day and make working much more efficient allowing contractors to cut costs on projects. BIM and Drones are good examples. Millennials are technologically savvy and find it easy to adapt to new ways of working.

2. Show the potential a career in the industry has. Millennials are looking for opportunities to be successful in whatever they do. They are looking for career advancement and leadership opportunities. It is important to move away from the "time served" approach of so many older members of the industry and look at ability and track record when it comes to promotions and rewards.

3. Flexibility. A recent article by the FT reported that the culture of long hours fails to deliver. The outcome is that rigid working cultures that measure performance by the hour lead to fatigue. Flexibility in working and a move away from a culture of "face time" in the office is attractive. People recognise they have deliverables and that they are responsible for them. Flexibility in working hours doesn't mean people work less, but it leads to happier, more productive workers because they can work around other commitments like children or so that they can travel in less busy periods of the day. 

4. Make the earning potential obvious. Construction can pay well. Particularly with a shortage in skills and a larger demand for project personnel is pushing wages up. This is especially the case in rail where there is an even larger labour shortage, there is the potential for wages to increase. According to Thisismoney.co.uk pay for massively in-demand rail workers and engineers building new lines and tunnels has soared by a staggering 74 per cent between 2012-2015. 

This group of young, bright and talented people could be the answer to filling the labour shortages and reducing the number of available construction jobs from 182,000. With unemployment amongst 18-24 year olds in the UK at a level where it is one of the highest in the developed world this could solve two major issues the UK is facing. Attracting Millennials could also be a way of bringing the construction industry into a new era, focusing on using the latest technology and efficient working moving the industry away from the old rhetoric of "this is how we've always done it".  

By attracting the brightest and smartest young minds to replace those leaving the industry, it could become the norm for construction projects meet the targets of being completed to time, quality and budget. 

Wonder Woman: Does she help the female cause or is it down to those already in the Construction Industry?

A friend of mine recently asked me what I thought about Wonder Woman being appointed as the honorary ambassador for gender equality by the United Nations. I paused and asked, "as in the comic book FICTIONAL character?" To which she confirmed it was. My answer was, " I think it's stupid, why would you choose a made up character when there are so many more real women who are alive". My answer was reactive, and knowing she had more than likely given the question some real consideration, I asked her what she thought. She said, "to me it implies that gender equality is fictional if they appoint a fictional character". She continued to acknowledge that Winnie-the-Pooh had been appointed honorary ambassador for friendship and Tinkerbell the honorary ambassador of green but went on to say "this is different because its about gender equality, and by that I mean it's too important to be given to a character who cant speak, who HAS NO VOICE."

And there it is, a theme that can be applied to so many things these days.  Gender equality or lack thereof. Something that in 2016 seems so backwards, yet something that the UN is contributing to whether unintentionally or not.

A hot topic generally at the moment, gender inequality is all over the news and social media and is certainly a cause worth speaking out about. In our day to day lives we live it, and some more so than others. With this in mind, I've been looking at the UK construction industry - of which I am a part - and the enormous gender imbalance within the industry. 

Looking specifically at the UK construction industry, which according to the Office of National Statistics is made up of 11% women - 1% of which are "on the tools" in jobs such as carpentry and plumbing and the other 10% include support and professional roles. It doesn't seem to be progressing towards gender equality at a speed that should be expected in 2016. Organisations such as Women into Construction and the Construction Youth Trust are working towards getting more women and girls into the industry by working with Contractors, Consultants and other bodies in the industry but there seems to be a long way to go and an uphill struggle to persuade firms that women are equal to men when it comes to hiring for construction roles. 

It seems strange to me that when there is such a large skills shortage in the industry we are not tapping 50% of the population to fill this gap. Especially when it is proven that a mix of men and women make businesses more productive because of the different approaches and skills they bring to the table. 

As a female in the construction industry I understand it is not always the most appealing industry to work for from the outside. With research suggesting direct and indirect discrimination, and harassment are the norm along with the presence of a glass ceiling that male counterparts do not encounter, there is still a lot of work to do to level the playing field. As younger generations enter the construction industry and older generations leave, I certainly notice that attitudes are changing. My personal experience has been positive in the main but perhaps that's down to experience, my expectations and very importantly a thick skin and a sense of humour.

The industry is beginning to do more, and it appears to see the value in making the work environment a more hospitable place for female workers but this is a slow process. So whilst it is clear the industry needs more time to tackle the gender imbalance, it also needs to hurry up because for each day, month or year it delays, it is losing out on the brightest and best of female engineers and project managers to name a few, to other industries such as Tech and Finance. It's time now for construction employers and professional bodies to get into gear and make construction a more modern, fast paced and innovative industry that is open and attractive to women. Its time to demonstrate what a fantastic industry construction is to work in.