The construction industry has been flourishing all over the globe. Especially towards the end of the 20th century, the demand for housing and offices rose. Moreover, infrastructural projects also increased, due to many governments planning a comprehensive development project for their countries. Such a rise was also reported in the UK construction industry too. With many talented architects and engineers, the country’s architectural composition has entirely changed.
Despite one of the largest industry sectors in the world and valued around £8 trillion per annum. Hence, making 13 percent of the total world’s output. However, as the number of firms has risen, so has the insolvencies that are up to 3.4 percent compared with retrospect years.
Here are the key challenges that we believe.
- Poor Productivity and profitability
Due to saturation in the construction industry, the competition has been fearing. Since where the competition is high, the profit margins are affected due to many players. Following that, firms have reduced investing profits in business improvements and critical technology.
The exacerbation of poor productivity is problematic for competition. The productivity indicators in the Engineering consultancy UK shows stagnant in the big picture. Due to the lack of improvement can be the reason for fragmentations in the industry. In the digital era, the industry still struggles in process management and streamlining. Most importantly, the documentation of online communication is a concern. Another reason can be that reluctance is an investment due to the economic downturn.
- Project performance
Undoubtedly, contractors have improved the delivery of projects over a period of time. In the evolving era, techniques and delivery strategies in construction have put in place as well as controls for safety and enhanced process risk management, scope, budget, and schedule.
However, project management still lacks transparency. The gap in policies, procedures, and controls are resulting in little elementary tasks becoming barrier progress. What’s needed is a robust and reliable process to assess. Furthermore, predict the potential problems can be flagged to keep that in mind while working on any project.
- Skilled labor shortages
The market of skilled is made up of four layers: traditionalists, baby boomers, Generation X, and millennials – all work differently and possess different attitudes, ethics and behaviors.
With several generations, people working under a roof, motivation and nurturing are very different and diverse. Apart from it, the studies suggest millennials have little interest in the construction industry which possess significant threat to skilled labor. The increasing complexity of the project and an expected decrease in experience levels of the UK workforce is posing threat significantly to future projects.
Conclusion Due to uncertain conditions that are prevalent in the country right now, the industry is gradually declining. Due to the announcement of Brexit, the future prospects of the industry are seriously endangered. Many of the construction companies in the UK are dependent on foreign workers, and thus this decision may lead to the unavailability of workers. Other than Brexit, one of the major challenges to the industry is its own age composition. The UK currently has 22% of the workforce, age 50 to 60. This is leading to more retirements and fewer replacements as students cannot see progressive careers in this industry. The depreciating sterling is also weakening the industry. With a 13% devaluation in the currency, the cost of importing raw materials has raised too; thus, endangering the UK construction industry.