Access to labour poses biggest challenge for housebuilders

A new report from Frank Knight cites access to labour as an ongoing problem in the construction sector. Many skilled construction workers moved away from the sector as activity largely ground to a halt after the financial crisis, it said.

“Luring former construction workers back to the sector and training younger entrants to the market is a key challenge, especially as the average age of workers in the sector is relatively high, exacerbating labour shortages as older workers start to retire,” the report said.

Seventy three per cent of respondents said the cost and availability of labour will have a negative impact on future housing supply.

This echoes what was said at the London Real Estate Forum (LREF) on 15 June, where Tony Pidgley, Chairman of Berkeley Group, said that it is impossible to deliver new homes at the speed London needs because of a lack of skilled workers. “On one site I have 15 bricklayers,” he said. “I need 60, but I can’t recruit them. The labour shortage is the industry’s biggest challenge.”

More than half of respondents also said their businesses would be stepping up starts and completions over the next 12 months. Some 24% said their completions would rise by 10% and a further 11% said they expected a rise of up to 25%.

More than three-quarters of respondents urged additional resources in local authority planning departments. Some 30% said making the planning process for public sector land more streamlined would help boost development numbers. Fifty seven per cent said they had not seen an increase in access to public sector land.

Accessing public sector land remains a challenge for housebuilders, despite a large-scale effort from policymakers to release such unused land. Earlier this year, the Government announced another tranche of public land sales, some 600 acres. However, there still seems to be a blockage in the system, hampering the swift movement from the identification of a potential site for sale to development, the report noted. This can often happen in and around the disposal, especially when the owner may want to retain an interest in the site.

The planning system also poses challenges, housebuilders say, with four in five respondents saying it will have a negative impact on supply. While the changes brought about by the introduction of the National Planning Policy Framework (NPPF) in 2012 have largely been absorbed, there are still some key issues around the time taken to achieve planning decisions, and the conditions applied to those permissions – with suggestions for a time-limit to be applied to signing these off. The need to bolster local planning departments is still seen as the biggest priority for policymakers, the report said.

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