There is no denying that things are on the up. Recent statistics are showing a marked growth in activity, led by the housing sector. Construction was identified last month as the most optimistic sector out of all industrial sectors. Mind you, from talking to people it’s clear that this change of heart comes more from a sense of only being beaten by rubber truncheons rather than iron bars. Life is still tough and making money even tougher.
What is uncertain though is the amount of work out there. This government, like the previous one, has the habit of re-announcing, double counting, then triple counting its infrastructure spend. With most of it happening over excruciatingly long time scales, it does not amount to much each year. Besides, so much of that spend will never get anywhere near the real construction industry as it gets swallowed up by the legion of consultants, advisers and lawyers.
The high-speed rail link HS2 has not got off to the best start. A project that gives a forecast marginal return in benefit in its original incarnation and then sees a 30% increase in its costs would in most rational scenarios be chopped. But this is not the case with HS2. Therefore the only conclusion is that the economic benefit case for HS2 is not relevant. It is hard to see where we get engineering or technology benefits either. With all the main parties supporting the project come what may, the only conclusion is that it is political, not rational.
Infrastructure apart, the upturn in housing and the increasing number of commercial projects coming to the market does give a glimmer of hope. It means that the country is on the mend.
For the industry to thrive though, it has to sort out how to bring people in, develop and retain them. In the last boom, the apprenticeship completion rate was only 39%. We were so desperate for workers they were employed before they were fully skilled and no doubt kicked out with the downturn because they were not fully skilled. We must avoid that this time.
We also need to ensure that those destined for the top acquire the right skills. The best builder does not automatically become the best construction businessman/woman.
HS2 shows there is more to that than just constructing a railway. Our next generation of leaders should be capable of running any business in any sector and unless construction has got its act together they might just decide to go and do that.
