Lloyds Bank's Housebuilding Report 2018 – Our Thoughts
Back in January, Lloyds Bank released their Housebuilding Report for 2018, which provides a detailed analysis of the state of the housebuilding industry today, as well as the opportunities and challenges it’s set to face in the future. The market has always been subject to political interference and action, which has increased in recent years in an attempt to support home buyers. As structural warranty providers, we take particular interest in the construction industry. Within this blog, we discuss the report in further detail, pulling out key findings to predict where we believe the future of the industry is headed.
- “The industry is increasing investment in modern methods of construction and skills to improve efficiency and boost supply.”
Existing modern techniques are centred on building larger components, and even entire homes, off-site ready for delivery and assembly on-site. According to findings, however, there are even more futuristic solutions on the horizon, from robot bricklayers to 3D printed homes. The report details that these site-based modern methods of construction are being employed by 61% of respondents. Companies of all sizes are investing in new building techniques and believe the utilisation of this technology will support innovation in the future. This being said, SMEs are slower to take advantage of these methods, which is likely due to initial costs associated.
Image taken from Lloyds Bank report for 2018
- “A third of housebuilders say there is a skills shortage at a national and regional level but are investing in training and apprenticeship programmes.”
Firms told Lloyds Bank that they planned to create more than 139,000 new jobs within the industry in the next five years. Small SMEs are also planning an uplift in recruitment. When asked what they would be doing to secure the future supply of staff, 69% of firms said they were investing in staff development, with 51% setting up an apprenticeship scheme/ programme and 47% working with government bodies.
- “Despite ongoing Brexit uncertainty, firms remain optimistic about the future with ambitious growth plans over the next five years.”
The lack of availability of skills and labour is causing problems and pressures within the housebuilding sector at the moment. These issues are being exacerbated by Brexit, as the UK prepares to leave the EU. According to research from the Home Builders Federation, 17.7% of the UK’s homebuilding workforce is from a European Union country, led by Romania, Poland, Lithuania, and Ireland. The industry’s reliance on workers from the EU could compromise its ability to deliver the government’s target of building 300,000 new homes every year. Reassuringly, however, 66% of firms believe there are currently enough workers with the required skills to fill roles within the sector, both nationally and regionally.
Overall, it has been another eventful 12 months for the industry and, with the Prime Minister promising to tackle the housing crisis, housing seems to have risen further up the list of political priorities. Modern methods of construction are now taking the lead, with modular homes and kit homes becoming increasingly popular to increase on-site efficiency. When it comes to new solutions, the future is bright, with groundbreaking methods on the horizon. Although Brexit is set to cause problems for housebuilders, developers, housing associations, and their supply chains, it’s good to see and hear that the industry is investing back into its employees and encouraging young people to begin a career, through training programmes and apprenticeship schemes. As always, the Housebuilding Report has proven to be a good read, with plenty of insight into where the industry is headed and we look forward to seeing how it changes for the better in the coming year.