The impact of COVID-19 on the construction industry

Article by Achilles

Date: 28 April 2020  |  Time to read: 4 mins

Building a new normal – how COVID-19 will change the future of the construction industry

Since the beginning of the year, the impact of COVID-19 on the construction industry has seen a massive 3,000 sites in the UK affected where 29% of work has been suspended, accounting for 36% of the work value, falling to the lowest level of activity in 11 years.

It’s a harsher story for Scotland though, as 79% of sites are suspended accounting for 83% of the value of work, leading experts to believe the industry’s output will decline by up to 50% if the new restrictions continue for the next three months.

Our BuildingConfidence community has over 2,000 construction suppliers from 15 different countries. 98% of suppliers are based in the UK and are feeling the full impact of COVID-19 on the construction industry, from site closures to furloughed staff and redundancies.

  • 37% of the UK construction sector is self-employed, which is high compared to the average across the whole economy which is 13%. (Construction industry: statistics and policy).
  • 51% of construction suppliers are considering a reduction in their workforce.
  • 65% of organisations having a robust plan to deal with the Coronavirus pandemic.

However, the industry hasn’t hit rock bottom and there remains some optimism for the future of the UK construction industry.

We spoke to Richard Howell MCIPS MICW, Chairman of the BuildingConfidence Steering Group who gave his view on what’s instore for the UK construction industry.

“We’ll come out of this and we’ll never work the same way again”, Richard Howell MCIPS MICW, Chairman of the BuildingConfidence Steering Group.

Embrace technology

“We’ll come out of this and we’ll never work the same way again. People have been embracing the functionality available on their computers, tablets and phones to remain effective during lockdown. Having used the latest technology, more often than not, businesses will decide that you don’t need to travel 250 miles for a 1-hour meeting and that it is acceptable to do it over video chat, which will create a more sustainable and cost effective way of working for the industry”, said Richard.

Safety comes first

The impact of COVID-19 on the construction industry is huge and safety has to remain paramount. “To comply with social distancing rules, operational working practices are being re-sequenced and operational sites are working tirelessly to stay up-to-date with the latest industry guidance”, said Richard.

“My advice is plenty of dialogue, buyers need to talk to their suppliers and ask how they can help if they are in any form of difficulty. It’s about working together to get through this”, Richard Howell MCIPS MICW, Chairman of the BuildingConfidence Steering Group

Collaborate

“My advice is plenty of dialogue, buyers need to talk to their suppliers and ask how they can help if they are in any form of difficulty. It’s about working together to get through this.

“We have already seen some collaboration in action, for example the way the construction sector has mobilised and come together to build temporary hospitals. “These have been built and brought into operation very quickly. The BuildingConfidence supplier network has contributed to that, whether that was the fitout of the building, the roads or the infrastructure. It’s a true testament to the construction industry working for the greater good”, said Richard.

Focus on long term

“There remains quite a lot of uncertainty, we think there is enough construction materials out there for the short and medium term because businesses had more stocks than they would ordinarily have due to Brexit concerns. However, when manufacturing comes back online and given the boom which may follow post COVID-19, there are concerns over shortages and whether we will have enough materials to satisfy everyone’s requirements in the long term.

BuildingConfidence buyers are interested to hear what suppliers think. The UK has quite a mature supply network, however we are also keen to understand if there are any European suppliers who can fill the gaps in UK construction for long term sustainability.

Survive the impact of COVID-19 on the construction industry

Suppliers can give their input on long-term disruption mitigation by completing the Achilles COVID-19 survey.

Similarly, if buyers or contractors require any additional support in locating suppliers during the COVID-19 disruption, Achilles can help them through the COVID-19 Help Desk.



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