British construction workforce too small to meet home-building targets

The UK's construction industry would need a considerable boost to its labour force or a change in building methods to meet the government's annual 300,000 new homes target, according to a report by Make UK Modular.

The organisation found that the country's workforce is not large enough to meet the current demand for housing, replace workers who will retire in the coming years and help retrofit homes for the path to net zero.

In 2019-20 there were just 242,700 net additional dwellings, which fell to 216,490 in 2020-21, partly due to the Covid-19 pandemic.

According to the research, the traditional housebuilding sector needs to recruit 137,000 more workers to hit the new homes 300,000 target by 2030 – triple the current rate. The manufacturers' organisation said only 11,000 construction apprentices finished courses last year, and most did not start a job in the housebuilding industry.

New construction workers will also be needed to replace the 360,000 workers due to retire by 2030. Additionally, new workers will be required to complete government initiatives like remediating unsafe cladding on high-rise buildings across the country - which is estimated to require a further 24,000 workers - and retrofitting homes to meet the government's net zero targets, which will require 220,000 new workers by 2030.

In total, the whole construction industry faces the impossible goal of needing to recruit over 950,000 workers by 2030 to meet all of these demands.

This labour shortage equated to a loss of around £2.6bn of output in construction in 2022 and £263m of lost housebuilding output, Make UK Modular has said. In addition to the lack of skilled workers, the report also identified "cumbersome" planning regulations and a lack of money going to the sector as barriers.

In order to meet their targets, Make UK Modular has called on the government to back the construction of low-energy modular homes.

"To address the issue of labour shortages which is now at critical point, government must help modular to grow at speed and take advantage of the fact modular can build homes quickly but also homes which are efficient to heat and run," said Steve Cole, Make UK Modular director.

"The changes we are asking for, such as dedicating a substantial chunk of the affordable homes programme to modular, would not cost any extra money, but they would help drive way faster growth in the sector and mean modular factories could operate at maximum productivity to deliver the homes Britain so desperately needs."

Modular homes can deliver factory-built houses with 50 per cent fewer workers from a different pool of employees and are 40 per cent more productive than traditional builds, according to the organisation.