Whatever the political motivation behind John Reid’s decision to restrict the number of Romanian and Bulgarian workers entering the UK in the new year, construction and the wider business community is unlikely to sympathise.
As well as alleviating the industry’s skills problems, economists point to the beneficial effect immigration has on GDP and wage inflation.
Instead, building sites will once again be the subject of official suspicion. The home secretary has decreed that only highly skilled labour and students will be eligible to work in the UK. But these workers will inevitably be accompanied by a wave of others who have obtained their permits by hook or by crook. Much has been written about the government’s plans to impose instant fines on illegal workers, and the possibility of fast-track deportation, but the fear among employers is that they will also cop the fines, and the bad publicity that goes with them, whether they deserve to or not.
Reid’s restrictions are to last for seven years. By then the chances are that the labour market will have become if not globalised, then at least regionalised. What this will mean for sites and outsourcing deals is unclear, but we are beginning to see UK firms making use of the pool of professionals in relatively depressed economies such as Germany. That trend is bound to intensify.
In the still longer term, the flow of immigrants will change the demands placed on the construction industry. While Reid balances the economic benefit and political deficits today, tomorrow the flow of new workers and their families will increase demand for health, education, transport and affordable housing – and the consequences of that are going to provide work for many ministers to come.
Cut it out
It’s not the sexiest of issues, but it’s one that affects just about every company in the industry. If you want to increase your chance of winning work with progressive clients, and boost your profit from that work, you’d better worry about where the offcuts and hard core on your site end up Wates, one of the contractors in the vanguard of change, plans to cut waste to zero by 2010. The Major Contractors Group is following up with a plan to set a series of targets for waste reduction. Now is the time for the supply chain to join the march and help this most wasteful of industries to make a difference.
Tom Broughton, deputy editor