It’s that time of year, when Business Link Magazine invites readers to offer up their forecasts for the year ahead. It has become something of a tradition, given that we’ve been doing this for almost 35 years.
And, while none of us possess a crystal ball, it is uncanny how accurate some of these forecasts have been over the years.
Here we catch up with with Duncan Green, Managing Partner at property, construction and infrastructure consultancy Pick Everard.
“The construction industry faced its fair share of challenges last year – from the collapse of Carillion to the uncertainty that came along with Brexit. However, Duncan Green, managing partner at property, construction and infrastructure consultancy Pick Everard, has high hopes for 2019 and is confident that the industry will thrive, as more national projects are given the green light and productivity increases.
The UK construction industry
As an industry, we certainly experienced some unexpected challenges last year. We started 2018 with the collapse of Carillion and, as a result, there have been lessons learnt in the construction sector. Its liquidation cast an unstable shadow over the industry. Firms are now a lot more cautious in terms of prompt payments and only taking on secure contracts, with a strategic focus on balancing the interests of its staff, stakeholders and clients.
However, there were also positive announcements last year. On a national scale, Heathrow’s expansion was approved, the development around HS2 continued and a considerable amount of new funding was allocated to new housing across the UK. We also saw Sellafield’s nuclear industry developing further and a new prison for the Ministry of Justice announced for Wellingborough.
I was also pleased to see that the government has recognised the need to encourage more apprentices – with a new, £695 million initiative announced in the Autumn Budget last year – and I think that 2019 will be the year that we really see the skills gap start to close.
Of course, Brexit dominated the agenda last year and, in just a few months, we will be exiting the European Union – although exactly how this will happen is still somewhat unclear. We are planning to respond positively to the challenge and change it will bring. The Government and the Department of Business, Enterprise and Skills in particular will be strongly promoting UK-based skills and services, and we will want to make the best of that opportunity. Right across the firm we have a diverse workforce and we rely on skills from staff who have moved to the UK, so we are working hard to ensure they feel they will always have a future career here, whether we are in the EU or not.
2019 – what’s next?
Looking ahead, helping to meet the housing demand will be a top priority. It’s estimated that 340,000 extra homes are needed next year to keep up with demand and the infrastructure needed to support this programme will need to be in place.
I am sure we are all looking forward to seeing HS2 and Crossrail take shape but also how the Northern Powerhouse will further develop. The region still needs to be better connected, so I hope we will see more infrastructure projects announced in the area.
This year, we also really need to encourage further use of technology in the construction industry. Virtual reality, augmented reality, automated construction tools and developments in BIM’s capabilities have proven that technology can really answer the industry’s productivity problem. Keeping up with technological advances also makes the industry more appealing to graduates and apprentices and helps to address the skills shortage.
Brexit is fast approaching and we still have uncertainty as to the arrangements that will be in place. However, I am confident the construction industry will continue to thrive and support the country’s ambitious output and productivity targets.