LREF: Forget land supply, forget materials, and almost forget obtaining capital, the real obstacle to addressing London’s housing shortage is the 1m new workers that the UK construction industry needs to find in the next five years.
Although the house building industry currently employs 165,000 site workers and a further 50,000 white-collar staff, scaling up to deliver an additional 80,000 units to boost the annual total to 230,000 homes per year will require a further 123,000 workers, explained EC Harris’s Mark Farmer.
Farmer, who chaired the Housing: Creating the Capacity to Unlock Supply session at the London Real Estate Forum, tabled the EC Harris report People and Money, and explained that across the whole construction industry 224,000 workers would be required to deal with the industry’s expansion by 2019. Add to that 700,000 people required to replace retiring workers.
“The likelihood is that this is impossible,” Farmer said. The 20,000 new entrants per year and the much-vaunted saviour, immigrant labour, actually only providing 200,000 people in the last 10 years, “will barely scratch the surface,” he said.
“We need more people and we need to recruit aggressively and we need a different way of house building,” Farmer said.
“None of this is new,” said Laing O’Rourke’s Stephen Trussler. “The industry has been through this a number of times but we don’t seem to learn.”
Trussler said that his company is pursuing a smarter way. “The underlying principle is a model to reduce the amount done on site and maximise what we do off site.”
Laing O’Rourke has, he explained, invested over £100m in a highly automated manufacturing plant in the East Midlands and has spent the past five years exploring a new modular housing system with the potential for large-scale production.
