executive summary - upskilling workforces, helping...

Future skills needs in the York, North Yorkshire and East Riding Local Enterprise Partnership Area

More Developed Area: York and North Yorkshire

Construction:Construction of buildings

Beyond 2030 has produced this Report on behalf of Calderdale College and as part of the College’s delivery of the 2017-18 ESF funded Skills Support for the Workforce programme across the York, North Yorkshire and East Riding Local Enterprise Partnership Area.

June 2018

YNYER Future Skills Needs – Construction Sector. Construction of Buildings subsector

Executive Summary

York, North Yorkshire and East Riding Local Enterprise Partnership (YNYER LEP) has commissioned a series of research reports, which will allow key decision makers to understand more fully the future skills needs of the YNYER LEPs eight identified priority sectors.

Construction is extremely significant to the UK, contributing £130 billion in 2016 to its economy. There are four key subsectors: construction of buildings, civil engineering, specialised construction activities and architecture.

This report considers the construction of buildings subsector within the wider construction sector. This subsector employs 26% of the sector’s workforce across the LEP – the second largest subsector in construction after specialised trades.

Beyond 2030 spoke with 33 employers in this subsector across the York and North Yorkshire area and relevant stakeholders such as Construction Industry Training Board (CITB) and the North Yorkshire Construction Training Group which has informed this report, as well as drawing extensively on the authoritative sources mentioned in the bibliography.

More Developed Area (MDA) of York and North Yorkshire

York and North Yorkshire is divided into eight Local Authorities: Craven, Hambleton, Harrogate, Richmondshire, Ryedale, Scarborough, Selby and the City of York.

In 2016, it had a resident population of 813,300. Over 411,000 individuals are employed in the area. Employment rates stand at 80.7% for North Yorkshire and 77.5% in York compared to the LEP average of 78.8%.

The largest employment sectors across North Yorkshire and York are health and social work, accommodation and food services, and retail.

Construction of buildings subsector

General construction is the construction of entire dwelling, stores and other public and utility buildings, farm buildings and others. The firms operating in this area will bring together the craftsmanship, expertise and specialist skills required for each project.

Beyond 2030 has defined the subsector using the Standard Industrial Classification (SIC) of Economic Activity codes 41.1 and 41.2.

1,320 businesses operate in the construction of building subsector, employing 6,500 individuals. The subsector accounts for 2% of the total MDA workforce.

95% businesses employ less than 10 individuals. 41% of businesses are involved in the ‘development of building projects’ and 51% in the

‘construction of residential and non-residential buildings’. This is a subsector which provides management and oversight of the entire build process. Few women work in the subsector. Young people are underrepresented and older people are overrepresented. Modern methods of construction (MMC) have been promoted as ways of working more

effectively. However, off-site construction blurs the line between construction, manufacturing and engineering and results in greater emphasis on digital skills.

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The skills, experience and capability linked to Building Information Modelling (BIM) need to be developed to realise all the potential benefits.

Recruitment opportunities exist within the subsector, although firms report that a lack of skills is a key challenge facing organisations.

Skills levels are concentrated at Level 2 and 3. The subsector has a high proportion of individuals with a trade apprenticeship (12% compared to all economy of 4%), highlighting the importance of the Apprenticeship programme as an entry route.

Management, leadership, project and budgetary management skills are frequently mentioned by employers within the subsector.

Beyond 2030 found that employers struggled to find specialist trades. The subsector undertakes lots of mandatory training, leaving little room for additional

training as time and budgets are largely spent on training linked to legislation or compliance. There is general support for the Apprenticeship model. However, with 95% of businesses

employing less than 10 individuals, micro firms report challenges in actually engaging with the solution.

It is anticipated that the subsector will shift towards having more people holding higher qualifications.

Employers have not necessarily identified any new roles developing in the next 6 years. There are a number of external factors which seem certain to impact on the subsector in the

next few years.

Acknowledgements

Beyond 2030 would like to extend thanks to the 33 employers in the MDA area as well as both local and national stakeholders, including CITB and the North Yorkshire Construction Training Group who provided their time and assistance in giving us valuable insights into the issues facing the subsector.

Beyond 2030 is indebted to Calderdale College for the guidance and support received in completing this report.

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ContentsExecutive Summary...............................................................................................................................2

Acknowledgements...............................................................................................................................3

1 Introduction to the LEP and the research......................................................................................5

1.1 Construction sector...............................................................................................................5

1.2 York and North Yorkshire MDA..............................................................................................6

1.3 Local Authorities....................................................................................................................6

2 Construction of buildings subsector in North Yorkshire................................................................9

2.1 Introduction...........................................................................................................................9

2.1.1 Subsector definition.......................................................................................................9

2.1.2 Construction in North Yorkshire and York......................................................................9

2.2 Construction of buildings subsector economy and employment.........................................10

2.2.1 Jobs people do.............................................................................................................11

2.2.2 Modern methods of construction (MMC)....................................................................13

2.3 Skills needs – Primary research testing the data..................................................................14

2.3.1 Recruitment and retention..........................................................................................14

2.3.2 What are the current skills needs and skills gaps?.......................................................15

2.3.3 Validation.....................................................................................................................15

2.3.4 Skills needs/ gaps.........................................................................................................16

2.3.5 Training........................................................................................................................17

2.4 Apprenticeships in the Construction Sector.........................................................................17

2.5 Future requirements............................................................................................................18

2.5.1 Sector growth..............................................................................................................18

2.5.2 Replacement need and total demand..........................................................................19

2.5.3 Qualifications...............................................................................................................20

2.5.4 Future roles and skills..................................................................................................20

2.6 Drivers of change.................................................................................................................21

2.6.1 Political........................................................................................................................21

2.6.2 Economic.....................................................................................................................22

2.6.3 Social............................................................................................................................22

2.6.4 Technological...............................................................................................................23

2.6.5 Environmental..............................................................................................................24

3 Bibliography.................................................................................................................................25

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1 Introduction to the LEP and the research

The York, North Yorkshire and East Riding Local Enterprise Partnership (YNYER LEP) has commissioned a series of research reports which informs key decision makers as to the future skills needs of eight identified priority sectors. These sectors are:

• Visitor Economy. • Food Manufacture.• Voluntary, Community and Social Enterprise (VCSE). • Health and Social Care. • Construction. • Engineering. • Agri-tech.• Bio Renewables.

As the economic and political situation changes, it is almost universally acknowledged that improved skills, not least because of the link to enhanced productivity is a key way by which to improve economic well-being. Consequently, LEPs across England are looking at how best to support sectors with growth potential and which therefore may generate future wealth and prosperity.

In this research, Beyond 2030 seek to understand fully the future skills needs required to ensure that within the YNYER LEP area, priority sectors can recruit and develop world class employees.

As well as wanting to understand the characteristics and future needs of the eight sectors, the LEP hopes to develop an understanding of the most significant subsectors in each priority area by geography.

1.1 Construction sector

Construction is highly significant to the economy, contributing £130 billion in 2016 to the UK economy. It creates, builds, manufactures and maintains workplaces enabling businesses to flourish and the infrastructure which underpins our daily lives.

There are four key subsectors that make up the construction sector (ONS 2009):

Construction of buildings. Civil engineering. Specialised construction activities. Architecture.

This report considers the construction of buildings subsector within the More Developed Area (MDA) of York and North Yorkshire. The subsector accounts for 26% of the construction sector employment across the LEP, which is the second largest subsector after specialised trades.

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In this report Beyond 2030 sets out the skills and productivity of the area as a whole as well as at Local Authority level to provide important context, before considering the subsector in further detail.

1.2 York and North Yorkshire MDA

North Yorkshire covers an area of 8,654 square kilometres (3,341 sq. mi), making it the largest county in England. Much of the Yorkshire Dales and the North York Moors lie within North Yorkshire's boundaries, and around 40% of the county is covered by National Parks.

York and North Yorkshire is divided into eight Local Authorities: Craven, Hambleton, Harrogate, Richmondshire, Ryedale, Scarborough, Selby and the City of York.

In 2016, it had a resident population of 813,300, which equated to 71% of the LEP’s resident population (ONS 2017). Over 411,000 individuals are employed in the area. Employment rates stand at 80.7% for North Yorkshire and 77.5% in York compared to LEP average of 78.8% (Table 1).

Using the YNYER LEP as the standard, the various differences in the productivity, skills and employment across North Yorkshire and York can be seen. Table 1 highlights where the area performs better (green) or worse (red). Self-employment in North Yorkshire, for example, stands at 13.9% - greater than within York, the LEP as a whole and the English average. However, the proportion of individuals qualified to level 4 or above is lower and the proportion with no qualifications is higher in North Yorkshire.

The largest employment sectors across North Yorkshire and York are health and social work, employing 13% of all workers, accommodation and food services, employing 11% of all workers, and retail which employs 10% of the workforce (ONS 2016).

Table 1 Productivity, skills and jobs

Measure North Yorkshire

York YNYER LEP

England

Gross Weekly pay full time (£) (place of residence, 2016)

£489.10 £509.60 £504.70 £544.70

Job density (the ratio of total jobs to population aged 16-64, 2015)

0.96 0.85 0.86 0.84

Employment Rate (Apr 2016-Mar 2017) 80.7% 77.5% 78.8% 75.6%Self-Employment (Apr 2016-Mar 2017) 13.9% 9.7% 12.0% 10.9%Full-time workers 63.1% 62.7 63.8% 69.1%Unemployment Rate (Apr 2016-Mar 2017) 2.9% 3.0% 3.2% 4.4%Economically Inactive (Apr 2016-Mar 2017) 16.8% 20.0% 18.5% 20.9%Level 4+ (Jan 2016-Dec 2016) 35.9% 42.7% 37.5% 37.9%No Qualifications (Jan 2016-Dec 2016) 6.5% 6.1% 6.3% 7.8%

Source: Office for National Statistics: LEP and National Labour Market Profiles; GVA for Local Enterprise Partnerships

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1.3 Local Authorities

Looking in more detail at Local Authority level, variations in the employment rate are obvious: Craven, Harrogate and Scarborough have the highest rate at 83% while Richmondshire has the lowest at 75%. Worth noting is that the employment rate in seven of the Local Authorities is greater than the national average (Figure 1).

Figure 1 Employment rate across the LEP and North Yorkshire Local Authorities (Apr 2016-Mar 2017)

Craven

Harrogate

Scarborough

Selby

Hambleton

Ryedale

York

Richmondsh

ire

YNYER LEP

England70%

72%

74%

76%

78%

80%

82%

84% 83% 83% 83%

80%

79% 79%78%

75%

79%

76%

Source (ONS 2017)

Using the YNYER LEP area as the standard, additional variations in the job, skills and productivity levels of each of the local authorities are highlighted in the table below. Where the area performs better, these have been highlighted in green with relatively poor performance being highlighted in red in Table 2. In summary:

Four Local Authorities have a lower weekly wage than the LEP average (Craven, Hambleton, Ryedale and Scarborough).

In three Local Authorities (Craven, Harrogate, and Ryedale) the job density is above one - meaning that there is more than one job for every resident aged 16-64.

Self-employment is particularly high in Harrogate and Scarborough. The proportion of full-time workers is low in Scarborough. The proportion of workers with a level four qualification ranges from 23.4% in Hambleton to

50.3% in Craven.

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Where the local authority area performs better than the YNYER average this has been highlighted in green, or worse, in red in the table below.

Table 2 Productivity, skills and jobs by local authorities in York and North Yorkshire MDA

Craven Hambleton Harrogate Richmondshire Ryedale Scarborough Selby York YNYER LEP

England

Gross Weekly pay full time (£) (place of residence, 2016) £413.10 £496.80 £535.50 £507.20 £443.10 £460.30 £549.40 £509.60 £504.70 £544.70

Job density (the ratio of total jobs to population aged 16-64, 2015)

1.16 0.98 1.06 0.80 1.02 0.93 0.73 0.85 0.86 0.84

Employment Rate (Apr 2016-Mar 2017) 83.0% 78.6% 82.7% 74.7% 78.6% 82.6% 80.3% 77.5% 78.8% 75.6%

Self-Employment (Apr 2016-Mar 2017) * 12.0% 16.9% * 12.9% 19.1% * 9.7% 12.0% 10.9%

Full-time workers 60.0% 65.0% 61.5% 62.5% 69.6% 58.5% 68.6% 62.7 63.8% 69.1%Unemployment Rate (Apr 2016-Mar 2017) 3.0% 3.1% 3.3% 3.4% 3.5% 3.5% 3.8% 3.0% 3.2% 4.4%

Economically Inactive (Apr 2016-Mar 2017) 15.6% 18.2% 14.4% 25.3% 19.3% 15.0% 16.0% 20.0% 18.5% 20.9%

Level 4+ (Jan 2016-Dec 2016) 50.3% 23.4% 42.8% 25.3% 36.8% 37.7% 31.1% 42.7% 37.5% 37.9%No qualifications (Jan 2016-Dec 2016) * 9.1% * * * 7.4% 8.9% 6.1% 6.3% 7.8%

Source (ONS 2017) * data not available, sample too small

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2 Construction of buildings subsector in North Yorkshire

2.1 Introduction

The construction process is a complex one, starting with design and planning progressing through production to ongoing maintenance and refurbishments. Construction work is almost entirely undertaken on a project by project basis. Contractors draw together teams of people to complete different areas of the build on-site. Much of the work in constructing a building is managed by a main contractor who is the point of contact for the client but who subcontracts part of the work to smaller firms who then specialise in a particular aspect of the process.

2.1.1 Subsector definition

This report is looking specifically at the general construction of buildings. General construction refers to the construction of entire dwelling, stores and other public and utility buildings, farm buildings etc. The process includes new work, repair, additions and alterations, the erection of pre-fabricated buildings or structures on-site, and also construction of a temporary nature.

The firms operating in this area will bring together the craftsmanship, expertise and specialist skills required for each project. They will generally also undertake full project management.

For the report Beyond 2030 has defined the construction of buildings subsector using the following Standard Industrial Classification (SIC) of Economic Activity. SIC is a standard measure of activity used by government (ONS 2009).

SIC Description 41.1 Development of building projects41.2 Construction of residential and non-residential buildings

2.1.2 Construction in North Yorkshire and York

Construction is recognised as a key sector across several of the Local Authorities in the MDA area.

Scarborough Borough Council recognises it as a growth sector and has a commitment to facilitate the building of 10,000 new homes across the borough, creating 4,000 construction jobs by 2030 (Scarborough Borough Council 2017).

Selby District Economic Development Framework has construction as a priority growth sector, with the aim to build 450 houses per annum (Selby District Council 2017).

Hambleton District Council reports a local competitive advantage in specialised construction activities and civil engineering due to a concentration of businesses and/or employees (Hambleton District Council 2014).

Craven District Council Plan 2017 -2020 sets out how it will facilitate economic growth through the provision of 214 homes per year and the development of 8 hectares of new employment land by 2020 (Craven District Council 2017).

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2.2 Construction of buildings subsector economy and employment

Across York and North Yorkshire there are 1,320 businesses working in the construction of buildings. Examples of these companies include:

Acomb Construction Ltd. http://css.uk.net/acomb/ Charleswood Property Developments. http://cw-properties.co.uk/ Evora Construction Limited. http://www.evoraconstruction.com GEM Construction. https://www.gemcs.co.uk/ Harris Construction York. http://www.harrisconstruction.co.uk/ Harrison Builders. http://harrisonsofyork.co.uk/home/2311191 Leeds & York Building Company. http://www.leedsyorkbuildingcompany.co.uk/ Northmead Developments Ltd. http://www.northmeaddevelopments.co.uk/ J M Butler Builders Limited. http://www.jmbutler.co.uk/index.php Randall Orchard Construction Ltd. https://www.randallorchard.co.uk/ SDT Builders Ltd. http://builderinyork.com/ Simpson (York). https://www.simpsonyork.co.uk/ TWS Construction UK Ltd. http://www.twsconstruction.co.uk/ William Birch & Sons Ltd. https://www.williambirch.co.uk/

6,500 individuals work in the construction of buildings subsector, across the York and North Yorkshire area. The subsector accounts for 2% of the MDA workforce (ONS 2017).

York district has the highest levels of employment within the subsector, accounting for 23% of the workforce. A further 19% are employed in the Harrogate district.

The majority (95%) of businesses employ less than 10 individuals, with less than 1% employing more than 250.

Figure 2 Distribution of construction of building businesses and employment in North Yorkshire

York

Harroga

te

Hamblet

on

Ryedale

Craven

Scarb

orough

Selby

Richmondshire

050

100150200250300350400

02004006008001,0001,2001,4001,600

Number of businesses Employment

Num

ber o

f Bus

ines

ses

Empl

oym

ent N

umbe

rs

Source (ONS 2017) & (ONS 2017)

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https://www.williambirch.co.uk/

http://www.twsconstruction.co.uk/

https://www.simpsonyork.co.uk/

http://builderinyork.com/

https://www.randallorchard.co.uk/

http://www.jmbutler.co.uk/index.php

http://www.northmeaddevelopments.co.uk/

http://www.leedsyorkbuildingcompany.co.uk/

http://harrisonsofyork.co.uk/home/2311191

http://www.harrisconstruction.co.uk/

https://www.gemcs.co.uk/

http://www.evoraconstruction.com/

http://cw-properties.co.uk/

http://css.uk.net/acomb/


41% of the businesses in the subsector in the area are involved in the ‘development of building projects’ (Figure 3). This industry includes the development of building projects for residential and non-residential buildings by bringing together all the different required elements (financial, technical and physical) to take the building projects all the way to sale.

The remainder of businesses (59%) are involved in the construction of complete residential or non-residential buildings (commercial), either on own-account for sale or on a fee or contract basis.

Figure 3 Workplaces in construction of building subsector by speciality in MDA (2016)

41%

59%

Development of building projects

Construction of resi-dential and non-resi-dential buildings

Source (ONS 2017)

2.2.1 Jobs people do

The major occupational groups for the subsector in Yorkshire and Humber and UK level are shown in the table below. The greatest difference in the proportion of employment for the subsector compared to the all economy occurs in skilled trades occupations. This occupational group accounts for a third of the workforce compared to 11% in the all economy.

Skilled construction and building trades includes the occupations of:

Steel erectors. Bricklayers and masons. Roofers, roof tilers and slaters. Plumbers, and heating and ventilation engineers. Carpenters and joiners.

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Scothern Construction Ltd

A construction company based in Malton, near York, North Yorkshire, operating throughout Yorkshire, the Midlands and the North of England. They are a well-established building company working alongside construction companies within the many various sectors of the building and construction industry.

They are a Government approved Constructionline Contractor with a client satisfaction score of 8.79 (UK average is 8.00) and undertake projects in value of up to £3 million.


Glaziers, window fabricators and fitters. Construction and building trades n.e.c. (not elsewhere classified). Plasterers. Floorers and wall tilers. Painters and decorators. Construction and building trades supervisors.

Entry to many of the skilled trades roles in construction is typically through an apprenticeship or vocational qualification (NVQ/SVQ) at Level 2 or 3.

The subsector also employs a greater proportion of managers compared to the whole economy. Given that many firms of this nature provide the overall project management of the build this is perhaps unsurprising. In comparison, the subsector has a lower proportion of associate professionals, technical occupations, and sales and customer service occupations.

Table 3 Occupational groups

Construction of buildings (Y&H)

Construction of buildings (UK)

All economy (Y&H)

Managers, Directors and Senior Officials 20% 17% 10%Professional Occupations 10% 11% 19%Associate Professional and Technical Occupations

6% 6% 13%

Administrative and Secretarial Occupations

9% 8% 10%

Skilled Trades Occupations 33% 36% 11%Personal care services <1% 1% 10%Sales and Customer Service Occupations 3% 2% 8%Process, Plant and Machine Operatives 7% 8% 8%Elementary Occupations 11% 11% 11%

Source (Office for National Statistics; Social Survey Division; Northern Ireland Statistics and Research Agency. 2017)

The job roles which have the greatest number employed in the construction of buildings subsector across Yorkshire and Humber are:

Table 4 Top five jobs roles in construction of buildings subsector, Yorkshire and Humber

Occupation Number employed Production managers and directors in construction 7,900Construction and building trades n.e.c.* 5,100Elementary construction occupations 5,000Bricklayers and masons 3,400Plumbers and heating and ventilating engineers 3,000

Source (Office for National Statistics; Social Survey Division; Northern Ireland Statistics and Research Agency. 2017) * not elsewhere classified

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The subsector has few women working in it, with just 16% of the Yorkshire and Humber construction of buildings workforce being female.

Young people are underrepresented in the construction of buildings compared to the economy as a whole. Only 8% are aged under 25 and 28% are over the age of 55 in the subsector. This compares to 13% and 18% respectively in the whole economy.

With an ageing workforce and small numbers of young people entering the subsector, there are set to be significant challenges in future recruitment.

Figure 4 Age profile of the construction of building subsector, Yorkshire and Humber

Under 25 25 to 34 35 to 44 45 to 54 55 to 64 65+0%

5%

10%

15%

20%

25%

30%

35%

Construction of buildings All economy


2.2.2 Modern methods of construction (MMC)

Modern methods of construction (MMC) has been promoted as a way of working more effectively. It centres around the use of off-site construction that can benefit from factory conditions and mass production techniques and economies.

However, off-site construction, the manufacture and assembly of construction components prior to installation on-site can blur the line between construction, manufacturing and engineering and consequently places greater emphasis on cross over skills such as project management.

There are four core categories of off-site construction (CITB 2017):

Component sub-assembly: Relatively small-scale items that are assembled offsite – e.g. light fittings, doors, windows or door furniture.

Non-volumetric pre-assembly: Large category items assembled in factories prior to installation which do not contain usable space – e.g. panel systems.

Volumetric pre-assembly: Units enclosing usable space that are installed within or onto a building; typically, fully furnished internal spaces - e.g. toilet/bathroom pods.

Complete buildings: Units enclosing usable space forming part of the completed building; typically, fully factory finished internal (or external) spaces – e.g. restaurant facilities.

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Currently off-site construction accounts for less than 10% of total construction output (CITB 2017). However, this process can reduce waste, improve efficiency and productivity and contribute to cost savings overall. Growth in off-site construction is likely to be underpinned by the improvements in efficiency and productivity and technological advances (DCLG, 2017 & HM Government, 2013).

Off-site construction relies heavily on a collaborative approach to working, bringing together for instance, designers, engineers, architects, manufacturers and on-site managers and operatives. This approach can be regarded as very different in nature to the traditional way of working in the construction sector, where different specialities often work in isolation from each other (CITB 2017). Thus, skills and training needs, and qualifications, are equally traditionally structured in silos. Research has shown that there is a skills shortage among some of the most important offsite occupations, including designers, engineers and project managers (CITB 2017).

2.3 Skills needs – Primary research testing the data

2.3.1 Recruitment and retention

Firms are recruiting for a range of positions within the construction of buildings subsector. Roles included:

Redrow Homes Yorkshire were seeking an assistant site manager, with responsibility for ensuring the correct completion of works by all the sub-contract trades.

Site labourers (bricklayers) were required in Harrogate. A self-employed position, own transport was essential as was a CSCS card.

General builders were required by ID Developments, Scarborough. A CSCS card, previous experience on construction projects and an ability to travel were required.

TA Construction UK were seeking a General builder/bricklayer in York.

Data suggests that once a vacancy is filled, the construction sector does not have a problem retaining staff. In 2015, only 6% of UK construction firms reported retention issues (UKCES 2016).

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When firms where asked about challenges and threats facing the organisation and sector, feedback frequently mention recruitment and skills:

‘Obtaining the required skill set’ medium sized firm in Kirkbymoorside.‘Finding good staff’ small firm in Ripley.‘Shortage of skilled employees’ small firm in York.


2.3.2 What are the current skills needs and skills gaps?

2.3.2.1 Skills levels Just 20% of the subsector workforce in Yorkshire and Humber hold a Level 4 or above compared to 38% in the whole economy. 38% of the subsector do not hold a Level 2 qualification.

The subsector has a much greater proportion of individuals with a trade apprenticeship (12% compared to all economy of 4%). This is largely due to the fact that a third of the workforce are skilled trades which generally has entry routes via apprenticeships.

Figure 5 Qualifications levels of construction of buildings subsector

NQ

F Le

vel 4

and

abo

ve

NQ

F Le

vel 3

Trad

e ap

pren

tices

hips

NQ

F Le

vel 2

Belo

w N

QF

Leve

l 2

Oth

er q

ualifi

catio

ns

No

qual

ifica

tions

0%10%20%30%40%

Construction of buildings in Y&H Construction of buildings UK All economy Y&H


2.3.3 Validation

A number of accreditation schemes exist in the subsector which enable contractors and workers to demonstrate their skills and knowledge. These include:

Construction Skills Certification Scheme (CSCS). This is the leading skills certification scheme within the UK construction industry (CSCS 2017). Although not a legislative requirement it does provide proof that individuals working on a construction site have the required training and qualifications for the type of work they carry out.

There are additional schemes recognised in the construction sector which are affiliated to the CSCS card, such as the Electrotechnical certification scheme (ECS) (ECS 2017).

The Contractor Health and Safety Assessment Scheme (CHAS). CHAS promotes the benefits of effective Health and Safety within industries and business. The Health and Safety Executive describes CHAS as the benchmark to measure public organisations’ compliance with their duty to assess competence, under the revised Construction (Design and Management) Regulations 2007.

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2.3.4 Skills needs/ gaps

At the UK construction sector level, 10% of firms report having skills gaps (Vivian, et al. 2016). Many roles within the sector are specialist in nature and require specialist training.

Management skills in the subsector are paramount. Project management of any build can be a huge task and mistakes can be very costly.

Skills required

From our primary work, Beyond 2030 can suggest that the following occupations and skills are particularly needed and valued by employers:

Site managers / trades supervisors. Project Managers.

Given that firms in the subsector often subcontract specialist activities of the build Beyond 2030 discovered that employers also struggled to find:

Plant operatives. o Operating dumpers, excavators and other heavy machinery.

HGV drivers. Bricklayers. Roofers. Scaffolders. Electricians.

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The Construction and Housing Employment and Skills Pledge (CHESP)

Launched in September 2017 at Scarborough Construction Skills Village, the pledge is aiming to overcome the skills shortages and gaps in skills provision within the construction industry.

Those backing the pledge want to work together to ensure a skilled local workforce is available to build the anticipated 10,000 new homes that will be required in the Borough of Scarborough by 2030.

The establishment of the Construction Skills Village by Northern Regeneration CIC in collaboration with industry and education partners gives the opportunity to learn and develop construction skills. Partners that have signed up to CHESP want the Construction Skills Village to become a ‘one stop shop’ for construction and housing employers, learners, parents, adults and referral agents wishing to understand how to access the industry and recruit locally.

Source (Skills Village 2017)


2.3.5 Training

As a high compliance sector, employers are obliged to ensure that their staff undertake a range of training and development ensuring the safety of construction sites. These are often around core areas such as; health and safety and ensuring compliance with legislation (i.e. site operators licence).

As noted above, the increasing requirement of site operators for work personnel to hold a CSCS card will see a degree of continual training. Holders of the card need to renew periodically, and one aspect is the undertaking of the CITB Health, Safety and Environment test.

Cost and time were the main drag factors on engaging in non-mandatory training. In a highly regulated sector, employers will invest more in mandatory compliance training at the expense of other interventions.

2.4 Apprenticeships in the Construction Sector

Construction apprenticeships are classified under the sector subject area, ‘Construction, planning and built environment sector’. Data at Local Authority level provides an indication of uptake in each local authority (Table 5).

Across the area there were nearly 480 starts on a construction, planning and built environment sector apprenticeship. 27% of all starts were within York, with 17% in Selby and a further 13% in both Hambleton and Scarborough.

Table 5 Construction, planning and built environment apprenticeship programme starts by Local Authority

2011/12 2012/13 2013/14 2014/1

5 2015/16 2016/17

Craven N/A 30 30 40 50 50Hambleton N/A 30 40 70 60 60Harrogate N/A 30 40 30 50 40Richmondshire N/A 10 30 40 50 40Ryedale N/A 20 40 20 40 20Scarborough N/A 30 40 50 50 60Selby N/A 20 40 60 70 80York 110 70 100 140 160 130Total 110 240 360 450 530 480

Source (DfE, et al., 2017)

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Harrogate College

Part funded by the LEP, Harrogate College has undergone a £6m campus redevelopment. The new Technology Centre provides space for mechanical, electrical, welding and joinery workshops. It is a purpose-built environment enabling students to access top of the range equipment similar to that used in the workplace.

Source (Harrogate College 2017)


The sector has numerous apprenticeships on offer ranging from Level 2 to Level 6.

In our primary work, Beyond 2030 found general support for the principle of Apprenticeships. However, with the majority (95%) of businesses employing less than 10 individuals, micro firms report challenges relating to a lack of time, cost and finding interested candidates.

2.5 Future requirements

2.5.1 Sector growth

Future workforce projections for the subsector are available at the wider regional level of Yorkshire and Humber rather than the North Yorkshire area but this still provides a useful indication of changes in the workforce moving forward.

Employment in the Yorkshire and Humber construction of building subsector is expected to increase by 14.9% between 2014 and 2024 – or by 6,000. This contrasts with the region’s all sector economy where growth of 3.9% is anticipated (UKCES 2016).

Employment growth is expected across all occupational groups but particularly for skilled trades, managerial and professional occupations (Figure 6).

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Selby College, Aspiration Building

The specialist construction trades training facility that opened in July 2017, aims to train 1,200 construction apprentices by 2021. These will be recruited from Selby and the surrounding district and the East Riding of Yorkshire.

The college will be encouraging more female students to choose construction as a career.

Source (Selby College 2017)


Figure 6 Construction of buildings subsector occupational change, 2014 -2024 (000s), Yorkshire and Humber

Elementary Occupations

Transport and Machine Operatives

Sales and Customer Service Occupations

Personal Service Occupations

Skilled Trades Occupations

Administrative, Clerical and Secretarial Occupations

Associate Professional and Technical Occupations

Professional Occupations

Managers and Senior Officials

0.0 0.5 1.0 1.5 2.0 2.5

Source: UKCES Working Futures VI

2.5.2 Replacement need and total demand

Overall, the subsector in Yorkshire and Humber is expected to have approximately 20,000 job openings between 2014 and 2024: but to note is that 14,000 will be replacement demand.

Nearly half (45%) of all job openings will be within skilled trades occupations and a further 13% in managerial roles (Figure 7).

Figure 7 Job openings in the construction of buildings subsector by occupation 2014 - 2024 (000s) in Y&H

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Prof

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ed T

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s Occ

upati

ons

Pers

onal

Ser

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Occ

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02468

10Expansion demand Replacement demand Job openings


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2.5.3 Qualifications

The change in qualification levels of the workforce shows that there will be a shift towards more people holding higher qualifications (Table 6).

By 2024, 31% of people employed in the construction of buildings subsector are expected to be qualified at Level 4 and above (less than the Yorkshire and Humber region all sector proportion of 47%), whilst the proportion of people with no formal qualifications or level 1 is expected to fall to 17%.

Table 6 Change in qualification profile of the construction of buildings subsector, Yorkshire and Humber

No qualifications and level 1 Level 2 Level 3 Level 4 – 6 Level 7 – 8

Qualification example

GSCE (grades D – G)BTEC level 1

GCSE (grades A* - C) NVQ Level 2

AS & A level BTEC National

Certificate of higher education (L4)Foundation degree (L5)Bachelor’s degree (L6)

Master’s degree (L7)Doctorate (L8)

2014 level 2024 level

9,4157,568

10,02511,530

12,09711,462

5,92911,554

1,0372,109

2014 – 2024 % change -20% 15% -5% 95% 103%2014 % share 24% 26% 31% 15% 3%2024 % share 17% 26% 26% 26% 5%


2.5.4 Future roles and skills

The above Working Future projections demonstrate that there is expected to be growth in the sector. However, the workforce will become more highly skilled and there are going to be fewer low skilled roles.

Employers have not identified any new roles that they expect to develop in the next 6 years; rather they expect to be recruiting for the same sorts of positions as currently exist, but they will be against different backdrops. By this Beyond 2030 mean that employers will look for similar technical skills and roles but, for example, will look for people who are cognisant of environmentally sustainable goods. With off-site construction increasing, this will become a more important part of the subsector and will impact on the skills required. Off-site construction will see the use of multi-skilled workers and could draw these from non-construction backgrounds such as other manufacturing sectors. Due to a high proportion of the build and fit out occurring in the factory, on-site time required for final finishing is reduced.

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2.6 Drivers of change

2.6.1 Political

Leaving the European Union

Plans to leave the EU, following the UK European Union membership referendum in June 2016, has left the construction sector facing an uncertain future.

The effect on inward migration particularly from EU countries could affect the sector’s ability to recruit and retain skilled staff and is by far the biggest issue employers have raised with us.

When the future regarding leaving the EU is clearer, companies will feel in a better position to make investment decisions. However, it is worth noting that the majority of firms are small and so the impact of the referendum is not being felt at these macro levels relating to investment decisions, however skills shortages is a very big issue and will be a real challenge for future policy makers.

Government Construction Strategy: 2016 - 2020

The Government Construction Strategy sets out a new plan to increase productivity in government construction projects to deliver £1.7 billion in savings and support 20,000 apprenticeships over the course of this parliament (Cabinet Office & IPA 2016). This is clearly set to be a massive driver of skills development.

Housing Policy

Housing is one of the government’s key priorities (DCLG 2017). The availability and affordability of housing has become increasingly discussed. The government has two strategic housing objectives:

1. Driving up housing supply, with the ambition of delivering a million new homes between 2015 and 2020.

2. Increasing home ownership.

Government plans to invest an additional £10million in the Help to Buy Equity Loan, which could help 135,000 more people to buy homes by 2021 (DCLG 2017). In addition, the Autumn Budget 2017, saw the announcement of the abolition of stamp duty for first-time buyers for homes worth up to £300,000. This drive to increase housing stock and ownership will require a skilled workforce to meet these targets.

Common Minimum Standards for Construction

The Common Minimum Standards for Construction (IPA 2017) sets out the minimum set of standards that apply to all public construction projects. Meeting these standards will support the delivery of value for money and wider policy objectives alongside enabling coordinated engagement with industry.

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Legislation / Regulations

This is a subsector which is heavily regulated.

Employers are not expecting there to be significant new legislation in the next few years, rather they are anticipating many current standards to move from EU legislation into UK law.

2.6.2 Economic

Rising Costs

The whole subsector is affected by rising operating costs. For example, the increasing cost of raw products impacts on the whole sector. Consequently, resource management and budgetary controls are important and will become more important in future years.

Interest Rates

November 2017, saw the first interest rate rise in over a decade from 0.25% to 0.5%. While this this interest rate increase will have little to no immediate impact on the construction industry, any further future raises will have an impact. For example, project will become more expensive, borrowing will cost more, so the growth in the sector could slow.

Wage levels, construction industry scheme and pensions

Running a payroll can be a complicated. Not only do construction employers need to consider National Minimum Wage (NMW) rates and automatic pension enrolment obligations, there is also the construction industry scheme (CIS). Under CIS, all payments made by contractors to subcontractors must take account of the subcontractor’s tax payments status, as determined by HMRC. All these require monthly reporting and for the late payment of CIS tax and submission of CIS returns there can be significant penalties.

With operating margins under pressure - the top 100 UK construction contractors saw average operating margins fall from 2.4% to 1.9% in 2015 (Farmer 2016) - future changes in employer pension contribution rates and to a lesser degree the NMW are likely to impact such a labour-intensive sector.

2.6.3 Social

The needs of the population in terms of infrastructure, housing, healthcare, education, work and leisure drives construction output.

Perception

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The construction sector has a poor image. CITB data shows that the overall appeal of the construction industry as a career option for young people is low, scoring 4.2 out of 10 among 14 to 19-year olds. It is perceived to be about 'being outdoors and getting dirty' and most suited to 'young people who do not get into college or university' (Designing Buildings 2017).

The sector needs to increase its appeal to future workers. Specifically, the lack of diversity is a real concern for the future – i.e. only 16% of the current workforce is female and just 8% are under the age of 25.

2.6.4 Technological

The use of automation and adoption of new technologies in construction has impacted on the sector in the past and will continue to do so in the near future. For example:

Modern methods of construction (MMC)

Modern methods of construction (MMC) have been promoted as ways of working more effectively. They centre around the use of off-site construction techniques that can benefit from factory conditions and mass production techniques and economies.

MMC have been an important technological advancement in the construction industry. A report by NHBC found that over 45% of those taking part in the study believed MMC will play greater role in house building over the next three years (NHBC Foundation 2016).

Building Information Modelling (BIM)

The implementation of Building Information Modelling (BIM) has been one of the major changes in the construction industry in recent years. BIM has replaced traditional blueprints with fully detailed, intelligent, and interactive 3D models.

At BIM’s core, lies information management which brings together all necessary information about the project into one collaborative place. Modelling an asset in digital form overcomes the problem of contractors and clients working in isolation, ensuring that everyone can work in tandem to achieve the same end goal in an efficient manner

Therefore, through BIM, the UK construction industry is undergoing its very own digital revolution. Government has mandated BIM for all centrally procured Government contracts from 2016.

BIM Level 2 was developed to meet this mandate. BIM Level 2 requires all project and asset information, documentation and data to be electronic, supporting efficient delivery at the design and construction phases of the project. At the design stage, designers, clients and end users can work together to develop the most suited design and test it on the computer before it is built. During construction, BIM enables the supply chain to efficiently share precise information about components, which reduces the risk of errors and waste.

Industry must therefore meet the challenge and work with the opportunities on offer. Only by implementing BIM will the subsector be able to deliver more sustainable buildings, more quickly and more efficiently. The skills, experience and capability around BIM need to be developed.

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2.6.5 Environmental

An Energy Performance Certificate (EPC) is required for all properties. This provides details on the energy performance of the property and what improvements could be made. This has led to focus on improving the energy performance of new and existing buildings. Some of the main energy saving solutions currently utilised relate to:

Heating and hot water: These account for around 62% of yearly energy bills. The type of boiler and heating controls installed can have a significant impact. Replacing boilers or having better controls or switching to renewable technologies for generating electricity and heat could be beneficial.

Smart meters: These are the next generation of gas and electricity meters and it is the government’s vision for every home in Britain to have one. They have a communication capability that allows data to be displayed on a device inside your home and read remotely by your energy supplier.

Smart heating controls: Smart thermostats are a new type of heating control which connect to the internet, allowing them to be accessed and adjusted remotely. They give individuals greater control over their heating, from wherever they are, at any time of day.

To install these new technologies requires specialist skills.

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While technology offers many advantages, there are challenges to implementation, as one construction firm in Selby reported:

‘Technology is becoming more advance in construction and as a small business investment in technology is a challenge. Competition in the UK and export markets is high, and businesses need to maintain systems and processes at the highest level the remain competitive’.


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Selby College. 2017. Aspiration Extension Supports Construction Indusrty Skills Gap. 3 July. Accessed February 2018. http://selby.ac.uk/news-events/college-news/news-from-2016-2017/aspiration-extension-supports-construction-industry-skills-gap/.

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