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The construction industry is on a real high at the minute; new developments are underway up and down the country, an increasing number of job opportunities are being developed and the best thing of all, it shows no signs of slowing down.
To gauge the views of those in the thick of it, PSR Solutions have teamed up with Midlands based building firm Boss Construction and Ian Parker, General Manager from UK Construction Online, a leading online based construction media group. Here we answer some of the most pressing talking points of the industry today;
PSR: The construction industry has returned to a state of growth as the economy finally comes out of recession. The industry was the first to be hit by the economic downturn and it was the first to recover as confidence grew in the economy.
The sector was hit particularly hard in the previous 5 years, with a lot of people made redundant as companies tightened their belts. Initiatives such as the Government’s ‘Help to Buy’ scheme have helped to stimulate a previously stagnate housing market and construction projects are finally getting the green light. Most construction clients are now busy as demand heavily outweighs supply.
IP: The construction industry is certainly experiencing a welcome period of buoyancy. Comparing the first quarter of 2014 with the same period last year, we see an increase of 5.4% (£1.5 billion) in building output, of which £1 billion is attributable to new commissions. Not only this, but forward forecasts of gross domestic output are being consistently revised upwards to reflect the optimistic outlook for our sector as a key driver for the economy at large.
Outside of housing, core infrastructure projects are playing an important role in the recovery. Crossrail is Europe¹s largest construction project and currently sees over 10,000 people working at more than 40 construction sites. Over 44 million working hours have already been completed and some £14.8 billion will be spent to deliver the project in late 2018.
This healthy combination of new work and repair and maintenance contracts, combined with encouraging numbers from the Office for National Statistics, points to a period of growth within the construction sector.
BC: We have most definitely seen a rise in the amount of work we are taking on since the middle of last year and to date in 2014. From repair and maintenance projects that not so long ago homeowners would be attempting to take on themselves to improvement and renovation projects like loft and garage conversions, people seem to be more inclined to call on builders to embark on projects around the home than they have been for a number of years.
As so many firms during the recession, we were hit hard with a lack of work coming in and had to cut costs wherever possible, but now we are taking advantage of these shoots of recovery and are doing well once more. The London market has been particularly buoyant and, compared to the five years previous, is almost unrecognisable.
IP: At present we are seeing a rapid increase in activity in the construction sector set against a demographic of an aging workforce and reluctance by people to take a job in the industry. The Government reports that one-fifth of all vacancies in the wider construction sector are persistent and hard to fill because employers cannot recruit staff with the right skills, qualifications and experience. Over 50% of employers report skills shortages in skilled trades, particularly in civil engineering and professional occupations.
Despite employers in the wider construction sector being more likely than average to offer formal apprenticeships - 17% compared to the sector average of 13%. – economic conditions have led to a substantial fall in apprenticeship completions in construction related industries - from about 22,000 in 2008/09 to about 16,000 in 2011/12 .
Evidence also suggests that parts of the construction sector have an image problem that may deter people. Data from CITB indicates the overall appeal of entering the construction industry as a career is low (scoring an average of 4.2 out of 10 among 14 to 19 year olds) and only slightly higher among careers advisers.
BC: A lack of work during times of austerity did lead to some of our most skilled workforce looking elsewhere, and it has been difficult to replace them. It’s hard to replace experience and many construction firms have been in the same position, as well as finding it difficult financially to take on apprentices.
We have been recruiting to meet demand and some of these skilled workers are steadily starting to return, but their experiences during the recession have left a mark, with many now reluctant to return in fear of it happening again. This has in turn led to many firms having no option but to employ those who don’t have as much experience and therefore skill in the trade.
PSR: The recession hit the construction industry hard and a lot of staff were forced to retrain or move into different sectors, these staff are slowly returning as the industry expands once again though. Opportunities were also very limited for apprentices so this meant a lack of young people entering the sector. This is being addressed but it will take time for staff to filter back into the industry and for any skill shortages to be addressed.
IP: Commitment is needed from Government, local agencies, employers and those involved in training, such as training providers and awarding/assessing organisations to address the worrying skills gap. Success will be achieved by constructive contribution from all parties.
Qualifications must be employer led and there needs to be a complete set of traineeships, apprenticeships and high apprenticeships for all the agreed construction qualifications.
The industry and the careers services also need to do more to counter the negative image of the industry. There are great opportunities in construction with rewarding and fulfilling careers, and more people need to know that construction is a good career option for them.
BC: As the industry grows and continues to stabilise, in the short term confidence should hopefully return which will see those specialist, most skilled individuals who may have moved elsewhere making the decision to come back to construction.
Further down the line, apprenticeships where work is combined with education as well as trainee programmes and placements are the way forward. Gaining experience from being on the job can’t be matched, so if we want to get people excited about working in construction, the opportunities to experience it first-hand need to be there.
PSR: In the short term we need to tempt back staff who moved into other sectors, whilst construction firms need to invest in training and development to up the skill levels of their present staff. Apprenticeships also need to be extended so that young people can be fast tracked into the industry.
The construction firms also need to be flexible with their workforce and use more freelance and contract staff to fill gaps. They could also work with universities, colleges and training providers to identify and address skill shortages, which could include offering sponsorships and bursaries to attract the best and brightest talent.
BC: The number of women in construction roles has always been low, perhaps simply because for as long as anyone can remember it has been perceived as a male dominated environment. If a candidate applies for a position with us and has the right credentials for success, we would have no hesitation in employing them, whether they are male or female.
Changing the perception of a whole industry will be difficult so in the short term this figure is unlikely to rise. Perhaps the industry needs a female role model to look up to and show how other women can be a success within construction, which would be a fantastic thing to see.
PSR We actively encourage and support female candidates and support any initiatives to tackle career stereotyping. We feel it is important that the construction industry works more effectively with schools and colleges to make them aware of the broad spectrum of professions available and believe that more women would be attracted to the industry if they were better informed about the available career options in construction.
IP: The construction industry has historically been a male dominated environment. In recent years numerous initiatives, such those which formed part of the delivery of London 2012, have attempted to encourage more women into the industry and they have achieved some success in changing attitudes, if not demographics.
To achieve a wider change the industry has to alter its public perception. Construction has come on leaps and bounds in terms of professionalism and working conditions but the challenge, however, is not just about getting women into the workforce, it’s about retaining them once they are in place.
Companies need to recognise the importance of a work-life balance, not just for women but for men as well. Flexibility is key to this and would help the industry retain its best people.
PSR: Reports are very positive and we hope for a steady and sustainable growth that coincides with an increase in skilled staff and young people being attracted to a career in construction.
With recessions typically coming in cycles and the construction industry being at the start of its return back to growth, PSR Solutions see the industry getting busier and busier over the next 5 years…..let’s hope it can find the staff to accommodate the growth!
BC: If the last 12 to 18 months are anything to go by, there are only good things to come. Of course following what has happened before there is the worry in the back of everyone’s mind that the same could happen again, but for the time being we have to have a positive outlook.
5 years, whilst seeming like a long time, is nothing in a fast paced industry like construction and both positives and negatives could be just around the corner. We have good work projections for the forthcoming months so are glad to be busy once more and hope that for us and other firms in the industry, the next five years are rosy and trouble-free.
IP: After suffering in recent years, the construction industry is now on an upward trajectory and figures suggest 2014 will be an excellent year for building firms. This is set to continue and the long term picture is undoubtedly positive with work on commercial projects rising at the steepest rate since 2007.
Having witnessed the ups and downs of the sector over many years, a word of caution is necessary though amongst all this optimism. The cyclical nature of our economy dictates that the compensating factors of growth will at some point cause a negative over reaction in the construction market. Whilst we are first out of recession, we are also first in and as a result we are all open to the immediate impacts of any downturn.
The industry is undoubtedly better placed to deal with any future economic downturn, but caution is the watchword when striking a balance between investing and consolidating.
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