Make UK’s ‘Who will be the builders?’ report ignores the fundamental reason that there is a skill crisis in construction, which is the broken and uncertain planning process constraining the employment and training of new workers.
Yet to grow the modular and offsite model, it has decided to ask for the broken and uncertain planning process to give them the security to grow their workforce and business models.
For small and medium-sized builders (SMEs), who train seven in ten construction apprentices, make up ninety percent of training capacity and typically employ within twenty miles of their head offices, this is a kick in the teeth they can do without.
In the last half century, SME market share has shrunk from sixty percent to twenty nine percent, and when larger medium sizes builders are removed, that number shrinks to nine percent. Is it therefore any wonder than as SME market share has shrunk and planning has become more bureaucratic and risk based, with pipelines much harder to establish, that the number of construction apprentices and the workforce has shrunk considerably too?
Of course not.
The HBA annual survey recently identified that ‘no pipelines of work’ and ‘lack of planning certainty’ were the top two reasons that respondents did not take on apprentices or grow their workforce. None said cost was an issue. This make sense, as if you can pay somebody to do a job you need doing, cost isn’t an issue. However, you’re unlikely to employ somebody to do nothing!
A HBA member who builds just thirty homes a year exampled this perfectly. In 2015 his company had 76 directly employed workers but in 2021 shrunk that to six, as they were unable to pay overheads for people doing nothing while the business struggled with planning. In 2023, the company is now down to four and with regret, because he loves building houses, the owner has decided the cost and risk of housebuilding is too great and they will concentrate on contracting and investing in the built environment.
Unfortunately, some of those representing the modular and offsite sector continue to reject the impact of planning on skills, with MMC champion Mark Farmer recently rejecting this analysis to say the issue is ‘demographic and societal, alongside structural decline.’ Yet the planning processes impact on pipeline is exactly the reason that modular and offsite will struggle.
Factory led solutions such as modular and offsite require great levels of efficiency to reduce costs, keep people employed and finance innovation. Therefore, a planning system which permits certain works at uncertain times, spends years deciding whether outline planning turns to full permissions and whose delivery timelines are controlled by inexact utility connection and statutory consultee sign off, isn’t a solid base for growth.
John Flemming, CEO of Tide Modular told ‘Build in Digital’ that “We are not there yet, but we can get there with the right support from the government to provide certainty of supply, which could be in the form of a streamlined planning process for MMC.”
A streamlined planning process? A recommendation the HBA has been making in relation to assisting SMEs for more than a decade. It is obvious to anyone who builds anything or needs space to invest; planning uncertainty is an investors nightmare, whether a small company working locally or a big company looking to deliver something new.
There is great accord between the HBA and MakeUK’s position but rather than working together to ensure the real productivity perils of planning are identified, the HBA often finds itself supporting a sector which seeks to further take its market share, rather than ensuring both succeed because the core failures are fixed.
This is frustrating because the UK is delivering at least 70,000 too few homes a year and SMEs have been implementing MMC solutions for decades, meaning they are at the heart of the MMC sectors growth.
Modular absolutely has a role in alleviating the pressures caused by a skills crisis and helping to solve the housing crisis but too often, it is pitching itself as a panacea, which it is not. The panacea is a functional planning process.
This piece will not go into the quality, health and safety, and insurance barriers faced my offsite, because they are surmountable but will highlight that as well as their being room for all players, the UK has twenty-eight million non-modular and offsites homes – 16.5million built before building regulations. twelve million with traditional building methods and two million in Conservation Areas – it is therefore a necessity that traditional skills continue to be taught and as highlighted, SMEs are the ones who do that.
There is also the issue that MMC, which was defined under a framework, is too often pitched as offsite and modular, rather than the full scope of definitions that 100% of businesses can engage in.
The productivity stifling planning process is the common barrier to the growth of a skilled construction workforce, more locally employing and investing businesses and the growth of MMC (including but not limited to offsite and modular). Unless industry and the Government coalesces around this reality, we are fighting amongst ourselves and doing learners, businesses, and Britain a disservice.
The silver bullet is not modular and offsite. It is the planning process. Fix planning, fix Britain.