18 COMMENT WHAT WILL THE REAL IMPACT OF
BREXIT BE ON CONSTRUCTION? Jerald Solis, business development and acquisitions director at Experience Invest, discusses the likely effects of Brexit on the construction industry, and the measures that could be taken to ease them.
to the ONS, one in four (28 per cent) of construction workers in London are from the European Union.
Should freedom of movement come to an
extra breathing space, however it remains to be seen just how Westminster will be able to manage the country’s withdrawal from the EU. The lack of political consen- sus has meant that businesses are none the wiser when it comes to understanding just what Brexit will mean for their respective industries. Fortunately, sectors like construction have proven resilient in the period follow- ing the EU referendum. Indeed, according to the Office for National Statistics, in November 2018 – with less than six months to go until the original Brexit deadline — the total value of construction output exceeded £14bn. This is the highest it has been since monthly outputs were first recorded in 2010. What’s more, investment has not dried
T
up. Public and private capital flows into infrastructure and housebuilding projects have created plenty of new opportunities for developers, ranging from the upgrade of existing transport networks to new-build housing complexes. Yet, despite the strong performance of the construction industry, there are still a number of obstacles preventing businesses from reaching their full potential, and the majority of these stem from Brexit. So what are the challenges the construction industry could face in the immediate future?
WHAT COULD BREXIT MEAN FOR THE INDUSTRY’S WORKFORCE? High on the list of concerns for many construction companies will be their continued access to skilled workers from across the EU. After all, the industry relies very heavily on overseas talent — according
WWW.HBDONLINE.CO.UK
he revised Brexit deadline – now set for 31 October 2019 – may have given the UK Government some
end, it is unlikely that the UK will be able to satisfy its need for skilled labour through domestic workers alone. This doesn’t just concern construction — all eyes will inevitably turn to the Government to see how it will continue to support a skilled workforce across different industries. There is some speculation that the government will apply its Tier 2 visa regulations to EU workers, as is currently the case with non-EU workers residing in the UK. Alternatively, new visa schemes might be considered to lessen the restric- tions on current and future migrants plying their trade in the construction industry. Regardless of what transpires, there is vital need for businesses hiring skilled EU workers to understand what their visa status will be as a consequence of Brexit. Failing this, we could see a shrinking workforce in the construction industry.
ENSURING COMPANIES CAN ACCESS BUILDING MATERIALS
Along with new restrictions on the free movement of people, Brexit could present new challenges when it comes to accessing construction products and materials. The UK construction industry has long
relied on imported materials, particularly from within the EU’s customs union. According to Build UK, more than £10bn worth of construction products are imported from the EU each year, represent- ing nearly 15 per cent of all products used in the sector.
Should the UK’s membership of the customs union comes to an end, so will the free movement of goods. Losing tariff-free access to the single market could see construction companies facing import duties and limits on quantities of imported materials – ultimately increasing the operating and construction costs of developers. In order to Brexit-proof the supply of
materials, the Government must work on establishing a fair future relationship with the EU that protects trade. At the same
time, it must offer construction companies comprehensive advice about how to prepare for likely Brexit scenarios, ensuring they can put into place a long-term strategy when it comes to accessing building materials.
WHY BREXIT CANNOT OVERSHADOW LONG-TERM CHALLENGES Addressing aforementioned issues must remain a priority not just to see the UK through Brexit, but also for the long-term future of the sector. After all, a skills short- age and reduced access to materials could create a knock-on effect on an even more pressing issue — the national housing crisis. Given the current imbalance between
supply and demand, it is estimated that between 240,000 and 350,000 new homes must be put on the market in England alone in order to restore balance. However, the Government’s current approach to ramp up housebuilding has so far been the subject of criticism. In 2017/2018, the total housing stock in
the country increased by around 220,000, falling short of the volume needed to ensure that there is amble supply to meet housing needs. So as we head towards the new Brexit
deadline, addressing the housing crisis must remain a national priority. This must necessarily start with diverting more attention and resources towards the construction sector, supporting current and future talent, and putting in place strate- gies to minimise the disruption from Brexit. I firmly believe that the future of the
construction industry looks bright. The sector has performed well since the EU vote, and continues to deliver valuable infrastructure and new-build houses. Demand for property is strong, and there is no sign of this slowing down anytime soon. Going forward, the industry must work hand in hand with government to ensure that construction companies can continue their projects whilst also being positioned to plan in the long-term. In doing so, the UK will be able to meet the evolving infrastructure and property demands of the population.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68
