Post Brexit skills shortages to push up tender prices by 4%

Grant Prior 6 days ago
Share

Tender prices are set to rise by 4% in 2022 as post-Brexit skills shortages bite across construction.

The latest forecasts from Arcadis predict rises after a period of industry “treading water” while politicians dither over Brexit.

The consultancy has held its short term inflation forecast at just 2-3% to 2021 as clients take a ‘wait-and-see’ approach to the current political turmoil.

Delays are adding competitive pressure to the market but the trend is highly sector specific.

Markets such as data centres are particularly busy, while others including offices, industrial and schools are on a downward curve.

Arcadis said there is enough competition to put a partial brake on input cost inflation in the short to medium term.

But tighter labour markets from 2022-23 means costs are predicted to rise by 1% per annum, reaching 4% by 2022.

Earnings growth for construction employees has averaged 4.2% over the past year, up from 2.1% in 2017.

Simon Rawlinson, Head of Strategic Research and Insight at Arcadis, said: “UK construction has a long-established skills and training problem.

“With skilled EU labour making up 8-10% of the workforce, specialist contractors and employers have been shielded from the necessity of developing and maintaining the skills of their workforce.

“However, with the prospect of post-Brexit restrictions on migration, we’re now facing a real crisis in terms of future labour capacity.

“The supply chain will need to look at other options for increasing productivity.

“Off-site manufacturing currently delivers around 8% of industry output, but with the introduction of a government mandate, this could increase significantly.

“Adopting new technologies to improve processes will help to eliminate waste and duplication, while a renewed focus on training and re-training – particularly with the introduction of T-levels in 2020 – will further help to support a much-needed flow of talent.”


 

Latest news

Galliford Try Partnerships buys northern builder

£62m turnover Strategic Team Group to be renamed Galliford Try Partnerships Yorkshire
10 hours ago

FRP Advisory appointed Shaylor administrator

Administrator confirms around 200 redundancies at collapsed Midlands contractor
15 hours ago

Scape slashes firms on next generation Venture framework

Venture Framework contractors cut from 13 to six firms
15 hours ago

Kier cutting 1,200 jobs and selling housing arm

Contractor quitting non-core operations as debt levels rise again
20 hours ago

Shaylor staff laid-off by Sunday morning email

Over 200 staff to be axed as directors confirm Shaylor is heading for administration
1 day ago

Willmott Dixon margin hits 2.8% as profit soars

Group builds cash reserve to weather further Brexit project delays
1 day ago

Multiplex brings profit back on track

Profit recovers to £18m on revenue of £1.1bn
19 hours ago

Roof safety horror show lands contractor in court

Photos show roofers risking their lives after HSE had already served a stop notice
21 hours ago

United Living wins £18m Poole tower blocks revamp

Project Admiral will see four housing tower blocks upgraded
1 day ago

Shaylor files notice of intent to appoint administrator

Subcontractors walk off sites as Midlands contractor seeks extra finance
3 days ago

Bidders day for £900m Heathrow rail tunnel project

Planned 6.5km rail link between the Great Western Main Line and London Heathrow Airport
4 days ago

Grenfell: 75% of unsafe blocks still to be reclad

Owners of 328 high rise blocks still need to complete remediation
4 days ago

Building products firm Alumasc issues profit warning

Problems at Levolux division cast shadow over upcoming results
4 days ago

Wooden football stadium plan rejected

Council rejects Forest Green Rovers plan for Zaha Hadid designed new ground
5 days ago

Flannery Plant Hire spends £30m on Cat machines

Huge deal signed at Plantworx exhibition
4 days ago

Boost your online presence – join the Enquirer Directory

Site for suppliers and buyers showcases products, services and latest stories
1 year ago

£1bn Stratford East Bank scheme clears final planning

Cultural and education centre in Olympic Park ready to go
5 days ago

Ringway wins £420m road maintenance deal

Highways England East Region contract could last 15 years
5 days ago

Hammerson unveils new Birmingham city quarter plan

1,300 homes and 1.4m sq ft of workspace planned for Martineau Galleries site
5 days ago

Planning row sees roads blocked on Persimmon site

Council blocks construction traffic to housing site
5 days ago

Tolent lands £84.5m Durham Milburngate contract

Contractor bags one of its biggest ever deals with main construction work set to start shortly
6 days ago

Government commits to net zero carbon by 2050

Industry must quickly rise to the challenge of improving the existing building stock
6 days ago

Extra week to put forward your favourite construction firms

Construction Enquirer Awards deadline extended: Enter online now
1 week ago

Wates ramps up FM offering with new business

Wates FM will target public sector work and wider spectrum of private clients
6 days ago

Worker killed by remote-controlled crane

Lift goes fatally wrong on National Grid site
6 days ago

Lendlease to start Manchester Potato Wharf phase 2

Castlefield scheme consists of two eight storey blocks
6 days ago

Wood drafted in for Hinkley Point C technical services

New Hinkley technical support deal to improve project delivery and commercial performance
6 days ago

Post Brexit skills shortages to push up tender prices by 4%

Consultant Arcadis predicts cost inflation rise in 2022
6 days ago

Robertson shuts “umbrella” employment on housing job

Workers moved back onto PAYE following union complaints over construction charter breach
7 days ago

Truro and Woking secure £142m for housing infrastructure

Local authorities secure cash to improve roads and access to housing land
7 days ago

Contractor services