Worries build in UK Construction industry as Brexit creeps closer
Posted: 27th March 2019
Immigration Advice Service
With Theresa May’s Brexit deal being defeated in Parliament, and no-deal still very much on the table despite the extension to article 50 announced last week, several industries are feeling increasingly concerned about what the future holds for them. Unfortunately, the construction industry is not exception to this; a no-deal would be severely detrimental to the sector’s current workforce, materials and funding.
The end to free movement is up there with the most troubling impacts that Brexit will have on UK industries. Currently, EU migrants are able to cross UK-EU borders with no requirement for visas or complex applications, allowing them to work in the UK if and when they choose. A CBI report released last year reiterated the magnitude of these effects and urged the government to consider the sizeable impact and importance of EU talent on UK industries.
Unsurprisingly, they didn’t listen.
Consolidating the future of a hostile Britain, May’s White Paper confirmed the end of free movement whilst laying out strict requirements for those looking to take the Tier 2 Visa application route into the UK. Despite lifting the 20,700 cap, the minimum income threshold of £30,000 still stands, meaning that many valuable ‘low-skilled’ workers, including construction workers, will simply be unable to apply.
For employers looking to employ migrant workers, they must first apply for a Sponsor Licence in order to officially ‘sponsor’ a migrant worker and bring them to the UK. This costs a significant fee and involves a series of complex processes, often causing delays for companies including construction. What’s more, the prioritisation of skilled workers to fulfil the gaps listed in the Shortage Occupation lists only pushes the ability to employ construction workers further away.
May’s solution for this, a temporary measure allowing workers to come to Britain for 12 months, fails to provide any clarity for workers trying to plan ahead and may not even be included in the event of a no-deal. This leaves EU workers in a state of limbo with the assurance of employment opportunities crumbling under the weight of the Prime Minister’s hostile environment.
But how many workers will this actually effect?
Currently, workers from outside the UK account for 15% of the construction workforce, equating to more than one in eight. Half of those come from an EU country. According to the Royal Institution of Chartered Surveyors (RICS), they could lose a huge 200,000 EU workers post-Brexit. The severity of this skills gap will affect almost all area of the construction industry and prohibit overseas workers from filling a range of skill-level jobs; from general (40%), skilled labours and tradespeople (11%), bricklayers (8%), plant and mechanical operations (7%) and supervisory/managerial roles (5%).
The implications of Brexit on the industries workforce are numerous and far-reaching. EU construction professionals and labourers are likely to turn their backs on employment opportunities in the UK once the government’s unwelcoming policies are implemented.
In addition to permanent construction roles, tighter border controls will problematise the current reliance of mobility and access required by temporary workers and contractors. For example, HGV drivers, who need continuous ease of transport and delivery facilitation, are likely to feel the full force of these restrictions on the pace and efficiency of their work.
Construction projects such as the Heathrow Expansion and HS2 are also set to suffer as EU workers held up by tighter border regulations may cause long-term delays. Additionally, Brexit could see the reversal of the EU as a fundamental source of investment for these types of projects. The European Investment Bank (EIB) and the European Investment Fund (EIF) invested £5.98 billion into infrastructure projects in 2015.
Whilst the Brexit impact on the construction workforce is undeniably worrying, this is not the only consequence that a no-deal scenario could bring to the future of the industry. According to Build UK, £10 billion construction products are imported from the EU every year. Crashing out the EU will place the UK at the bottom of the trade pile, with its new ‘third country status’ resulting in its trading certificates no longer being recognised in the its current renowned way. With the UK government setting targets to build 300,000 homes every year, the delay or processing difficulties at borders could have a devastating effect on achieving this aim.
Although some products can be traded domestically, others such as timber will need to be imported. A weaker pound will lead to rising costs of imported materials, making it imperative that investors and employers work collaboratively to secure an effective trade deal.
It is difficult to see past the fog of Brexit looming over our heads whilst questions surrounding the UK’s future remain unanswered. Feelings of uncertainty define the beginning of 2019 for the construction industry and will continue to prevail so long as a no-deal remains a possibility. The government desperately needs to consider the importance of the EU in providing a valuable workforce, accessibility to materials and financial aid to infrastructure projects. Otherwise, the industry faces a disastrous aftermath.
Contributor: This blog has been written by Maddie Grounds, political correspondent at the Immigration Advice Service.
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