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Brexit's impact on Recruitment within the UK Construction Industry

Posted by: Mark Brown
Now that the dust has settled and the hysteria has died down a little bit, we all have to face the fact that we are indeed leaving the EU. But what effect will the Brexit vote really have on the UK’s Construction industry, in the wake of the industry’s worst month in 7 years in June? (Metro, July 4th)

Mark Brown, Managing Director of Worldwide Recruitment Solutions, who operate a specialist division within UK Construction, comments, “We have received mixed messages from our clients- some have reported that they are facing a downturn and are steeling themselves for important changes whilst others see no material change to existing plans.” 

The first few casualties have been affected: some of the largest architecture practices in the UK have laid off staff in the wake of Brexit (Dezeen, July 7th), meanwhile Forterra, one of the largest British brick makers, has announced plans to mothball its plants in Accrington and Claughton, Lancashire, ahead of a potential downturn in the industry. (The Times, July 10th)

Residential building has been hit particularly hard, even despite record house prices and a lack of supply of new housing stock country-wide. Back in May the CEO of Barratt, the UK’s largest homebuilder Barratt, David Thomas warned – “A significant part of our labour force, particularly within the London market, [is] coming from continental Europe – the free movement of labour in the European market is a positive from our point of view. […] If you ask any housebuilder what their main challenge is, they say it’s labour availability.” (The Guardian, May 12th)

But not everyone is so pessimistic: consultants Arcadis predict a post-Brexit boom; with a falling pound leading to an influx of foreign investment – “reopen[ing] the luxury property market to overseas investors.” (Construction Enquirer, July 6th)

Here at WRS, we are confident that we can and will continue to support a wide range of clients within the UK Construction sector. Let’s be clear: we haven’t actually left the EU yet, so anything that’s happened so far is purely speculative – the consequences of the leave are actually still quite a long way off; what we really need to do is look through a variety of a different scenarios and plan for each and every one of them. Just because we are leaving the EU, doesn’t mean that people will stop needing houses – or anything else!

In an uncertain market, it makes absolute sense that investors are holding off before they know what state the economy will be in in 1, 3, 6 and 12 months. We’re likely to see existing highways and rail programmes going ahead as planned, but we’re also likely to see government spending decisions delayed over the coming months (where all of their time is going into Brexit planning) – so perhaps it’s just a waiting game.

Mark Brown continues, “Key to calming post Brexit shockwaves will be strong leadership from the new PM Theresa May, maintaining open and positive communication of a clear vision for the UK post Brexit – not just with Europe but the rest of the world – and subsequent delivery of the plan. Returning confidence to markets is imperative – volatility and uncertainty is and will continue to be the biggest danger to all.

In conclusion, we’d say the Brexit vote doesn’t fundamentally change the construction sector – which faces the same problems it has for months and years, those being skills gaps and deficiencies in supply.
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