Growth of construction industry dependent on huge infrastructure projects

Britain’s construction industry has been predicted to grow an average of 1.7% over five years, and the overall rise of the workforce over the last three years is at nearly 5%, according to the Labour Force Survey. However, it is heavily dependent on a few huge infrastructure projects.

The Construction Industry Training Board (CITB) has found in its latest annual report that the sector is predicted to continue to grow over the coming five years with a total of 179,000 jobs created.

Although, infrastructure work will account for almost half of 2017-2021 construction growth with big projects like the High Speed 2 rail link, Hinkley Point and Wylfa nuclear power stations projects. 

In recent years Private Sector housing developers have driven the industry but now the construction industry’s future is heavily dependent on these large politically sensitive infrastructure projects beginning on time.

The report makes it clear that there is uncertainty as to what weight should be put upon the forecasts as it states, “all predictions for the construction sector are made against a backdrop of ongoing political and economic uncertainty.” The report goes on to describe Britain’s vote to leave the European Union as “one of the most significant unknowns.” 

Furthermore, total construction output for 2021 could be 0.8% lower than currently predicted if Hinkley was to be taken out of the pipeline. Therefore, any changes made to large infrastructure projects would be felt throughout the industry. Equally, Controls on immigration would also affect the sector, due to its current reliance on foreign construction staff.

CITB’s Chief Executive, Sarah Beale adds that “we will be working with our industry to understand what it means for out migrant workforce and what we must do to attract and grow more of our own.”

The report also states that the public sector work is likely to stagnate over the forecast period with the output growth at an average of 1% up to 2021. Additionally, it was reported that the industrial sector is set to be the weakest performing with an averaging a 1.4% decline.

With Wales predicted to grow by 6.2%, and Scotland to decline by -0.4% each year, the picture across the regions of the UK is extremely varied. London however is predicted to remain a strong performer, growing by 2.4% each year, with employment growing by 6.6%. The Southwest (3.1%), the Northwest (2.5%) and the Southeast (2.2%) are expected to perform well, in England.

Sarah Beale explained, “while we are forecasting slower growth for our industry than we were last year, employers will still be creating tens of thousands of new jobs. We will be working with employers to attract new talent into our industry and to train them for rewarding careers in the sector.”