Warning over post-Brexit lack of construction workers

The British Property Federation (BPF) has warned that government efforts to address the housing crisis will falter if strict post-Brexit immigration controls result in fewer construction workers coming to the UK.

The construction sector needs to recruit more than 400,000 workers a year to meet demand for new housing. Picture: Michael Gillen
The construction sector needs to recruit more than 400,000 workers a year to meet demand for new housing. Picture: Michael Gillen

The organisation’s chief executive, Melanie Leech, said that access to talent following Britain’s divorce from the bloc is the most pressing concern for property firms.

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“Talent is a critical issue to sort and, in our sector, it’s construction skills,” she said.

“There are a huge number of workers coming from within and outside the EU currently and, if we’re going to have a really ambitious house building programme and we’re going to build the business infrastructure we need for the 21st century, we have to make sure we can staff the construction industry.”

Theresa May’s Conservative manifesto promises to deliver one million homes by the end of 2020, with a further 500,000 by the end of 2022.

However, the Prime Minister has also committed to slashing immigration to the “tens of thousands”, despite opposition from business groups warning of an already chronic skills shortage, including in the construction sector.

Construction consultancy Arcadis estimates that the construction sector must recruit more than 400,000 workers a year if demand for new homes is to be met.

“We know that migration has a net positive impact on GDP, they (the government) know all that, but there is this perception issue on the immigration question and they’re going to have to find a way through that,” Leech added.

However, the BPF chief commended proposals set out in the Housing White Paper, including measures to encourage “build to rent” developers.

She said, while not a “panacea”, the policy has the potential to bring in billions of pounds of new investment and welcomed the shift from an emphasis solely on home ownership.

The federation, which represents the UK real estate industry, is also calling on whichever party wins the general election to maintain an “absolute focus” on maintaining business confidence and ensuring the UK remains attractive to investors.

Property heavyweights such as Land Securities have recently flagged a fall in demand in the London office market following the Brexit vote which, coupled with a steady trickle of financial services jobs shifting to the continent, is concerning to the BPF boss.

However, Leech added: “I’ve seen no evidence of a wholescale exodus from the City. A number of people, however, are making contingency plans.

“But London isn’t just about financial services. There’s a huge range of businesses operating in the City and if you look at tech sector, it’s growing fast and thriving. My understanding is that no one in that sector wants to leave the UK.

In addition, Leech said that the UK’s fundamentals are still strong and pointed to “significant investment decisions” taken since the Brexit vote on 23 June.

“We have stable political system and a stable legal system and there’s a huge amount that makes the UK an attractive place to invest.

“So it’s not a doom-and-gloom scenario, but it’s a period where people have had to take stock and some people have pressed the pause button.”