Construction skills shortage a worry for building contractors

Eight out of ten building companies in the North West and Midlands think that the skill shortage crisis will hold back their businesses in 2016, with a shortage of quantity surveyors, estimators and site-based personnel causing particular concern.

New research undertaken by construction recruitment company, Ionic, found that 72.5% of contractors had issues with the skills shortage in 2015, with 82% believing it will have negative effect on their businesses in 2016.

The headline findings include 56.5% of respondents naming cost inflation for labour/subcontractor rates as a barrier to growth – an matter directly associated with skills shortages.

Martyn Makinson, Managing Director of Ionic, said:  “The New Year will highlight some old anxieties for many regional contractors. The construction industry has introduced a range of initiatives this year to try to combat the chronic skills shortages; however, the scarcity of key personnel continues to hold back the sector.

“The health of the construction industry should be a concern for everyone as its problems resonant. They impact the cost and delivery of projects from the smallest housing development to large scale in.  The cost pressures are about supply and demand – and the erosion of profit margins for companies which have only just recovered from the recession.”

The study also revealed increased instability in the workforce. 58.5% of North West building companies experienced an increase in staff turnover in the last year. In terms of vacancies, 60% said that the roles were newly created, with the balance replacement role. 52.5% said they’d had to make a counter offer to retain staff in the last year.

Mr Makinson commented: “People are the raw materials that will help a business grow but competition has returned to the jobs market in a way that impacts the bottom line.  In a candidate driven marketplace, Construction companies need to present themselves as attractively as possible.

“It’s also imperative that they sell themselves well at interview stage to prospective candidates by focusing on career and skills advancement opportunities; which from experience are more important factors than a salary increase.”

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