The UK's planned exit from the European Union will only exacerbate an issue which has been affecting the industry for some time, according to infrastructure expert Nick Ogden of Pinsent Masons, the law firm behind Out-Law.com.
The UK will require 400,000 new workers every year until 2021, regardless of post-Brexit immigration issues, every year to meet predicted demand, according to the Arcadis report (11-page / 2.7MB PDF). It will not be possible to fill these roles simply by training more people or through the increased use of technology and automation, at least in the short term.
Construction will be required to recruit from other industries, increase productivity and dramatically reduce waste if it is to overcome a drastic skills shortage, Arcadis said. At the same time, the government must quickly act to secure the rights of EU workers currently employed in UK construction and simplify the visa system, while minimising the effect of impending changes to the taxation of benefits in kind and the IR35 rules on workers and their employers, it said.
"The construction industry faces a significant challenge - the number of workers joining the sector is not keeping up with the demand and currently there is a real danger we won't have the workers to get projects to be built," said Ogden.
"Brexit will exacerbate the issue but there has been a problem for some time to get both blue and white collar workers into the industry. There needs to be a big push from the whole sector, supported by government, to attract these much-needed skilled workers, particularly those that may never have considered construction and will look to other industries such as tech and pharmaceuticals," he said.
"Over the past six months, the government has made a number of announcements focused on improving Britain's infrastructure and getting more houses built but it has not addressed the skills crisis that has the potential to hinder this. Skills will need to be a priority for the government if it wants to get vital infrastructure projects built and keep the UK open for business," he said.
Many construction-related occupations have yet to recover from the job losses sustained during the financial crisis, with total employment in the sector as a whole down 15% since 2008, according to Arcadis. This has led to what the report describes as the 'Minted' workforce, where those in 'Most in Need Trades' such as carpentry, joinery, plumbing, electrical work and bricklaying could potentially see their earnings double before another generation enters the workforce.
At the same time, the UK government has developed one of the most extensive national infrastructure programmes in Europe, with major projects such as HS2, Crossrail and an ambitious residential development programme likely to draw from the same limited pool of workers. In the event of a 'hard Brexit' scenario, under which EU workers become subject to the same points-based immigration system applicable to non-EU workers, a further 215,000 workers would need to be found to replace EU nationals leaving the industry, Arcadis said.
"As a firm, we have been discussing this issue with our clients for a number of years," said infrastructure employment law expert Ed Goodwyn of Pinsent Masons. "With Brexit potentially reducing the number of skilled EEA citizens being able to work in the UK, together with the pipeline of infrastructure projects, the issue is coming into sharp focus."
"The solution will require a mix of medium and long-term strategies involving not only the backing of those companies within the sector, but also government and educational establishment support," he said.