Brexit and the built environment – helping construction businesses navigate uncertain territory

As I write, the UK is due to leave the European Union on 31 October 2019. But that was this morning – goodness knows what the position is now! But regardless of when we leave, there are practical matters at hand – the uncertainty that this situation has caused across the economy and the possibility of a no-deal Brexit are very present.

The CIOB as the professional body for construction management needs to ensure that our membership - and the wider construction industry - has access to resources and advice to prepare to leave the EU with or without a deal.

Our position

Regardless of the views taken at the time of the referendum, we are where we are – for entirely practical reasons, it would be preferable if the government avoids a disorderly exit from the EU.

However, the uncertainty is undoubtedly having an impact on our industry and the only course of action is to deal with the day-to-day challenges: better recruiting into the industry; paying attention to due diligence, examining all the risks at project level and across the supply chain; keeping up-to-date on government advice and changes to legislation.

This is the position that our previous President, Chris Soffe, outlined earlier this year in Construction Manager: Why uncertainty undermines our industry.

Key issues for the industry

These are three of the key issues, although there are others, specifically facing construction in the UK.

• Access to talent and skills: following the UK’s withdrawal from the EU, potentially large proportions of migrant workers will lose their automatic right to work in the UK. Construction has always relied on a flexible migrant workforce and our report into migration from March 2015 delved into this in detail. This reduction in workforce numbers combined with the decline in new recruits into the industry will see a disproportionate amount of over 60s in the workforce in the next few years; the ONS estimated that one in five UK-born construction workers will be over the age of 55 by 2021. We can therefore expect there to be a skills gap.

• Material costs/imports and exports: the free movement of goods between the UK and EU will come to an end following the UK’s withdrawal from the EU. The Construction Products Association suggests that although most construction products used in UK are made here (75.6%), of those imported (24.4%), 60% come from the EU. However, when looking at softwood timber, 92% is imported from the EU, and timber prices are over 30% higher than before the 2016 referendum.

• Standards: arguably one of the UK’s leading products, environmental and professional standards, are central to our success as a global hub for built environment expertise. The UK has led Europe in demanding and delivering a regulatory regime supporting quality design and construction. This is helping make construction safer, greener and more efficient. Continued promotion and protection of product and professional standards is at the heart of ensuring that the UK can continue to support its traditional strengths while allowing industry to open up for new opportunities.

What has the CIOB done so far?

• The Joint Professions Group - consisting of the CIOB, the Royal Institute of British Architects (RIBA), the Royal Institution of Chartered Surveyors (RICS) and the Royal Town Planning Institute (RTPI) - have been examining the risks and opportunities presented by Brexit. These include access to talent and skills, common standards, research excellence, infrastructure investment, devolution and community development. A letter signed by the Presidents/Chief Executives of all the main professional bodies in construction was issued to the then Brexit Minister, David Davis MP, in September 2017 and we met with his team.

• We have responded to several consultations and inquiries on the impact of Brexit on the industry. We are quoted heavily in relation to migration data in the APPG for Excellence in the Built Environment’s Building on Brexit report from July 2017.

• We maintain regular contact with BEIS (Department for Business, Energy and Industrial Strategy) officials on Brexit related matters.

What else will we be doing?

• We will try to ensure that our membership - and the wider industry - has access to resources and advice in preparing for Brexit. This includes links to the government’s Get ready for Brexit: check what you need to do and the British Chambers of Commerce Business Brexit Checklist.

• We will consider an application for funding from the government’s £10 million Brexit readiness fund for business organisations. The funding will be available to professional bodies to support events, training and the production of advice packs to assist businesses in making sure they are fully prepared for Brexit on 31 October 2019.

• We will review existing guides and advice issued by businesses in the built environment on Brexit to support knowledge sharing through Construction Manager magazine and our other channels.

We will also continue to keep an eye on developments, including those that may have an impact on the individual home nations, and respond as best we can in the best interests of the sector. They used to say a week was a long time in politics but now an afternoon can change everything – expect more regular updates from us as we move inexorably closer to an exit.