Round and round and round we go

Skilled workers are so short on the ground that it could be impossible to build the extra 39,000 homes a year that the Barker review says are needed to match demand. A study by the Housing Forum and the University of Westminster has found that 49% of housebuilders are experiencing difficulties in recruiting site managers – that’s four times more than the figure for the construction industry as a whole.

In the report's foreword, Robert Ashmead, chairman of the Housebuilders Federation, writes: “An ageing workforce, new skill sets, the increased use of labour from overseas and the emphasis on modern methods of construction are some of the factors affecting the debate. Is the industry ready to take on the challenge of more homes for the South-east, the Decent Homes standard, and the regeneration of areas of low housing demand in the North?” The information that follows his foreword appears to provide a clear answer - no.

At the root of the problem is a failure to attract entrants into the housing sector – 63% of companies in the study cited low numbers of applicants with the required skills as a reason for recruitment problems. Of course, one way of sidestepping this issue is to poach trained staff from other housebuilders or contractors by offering them higher salaries. According to the study, this is on the rise; 49% of companies reported they had recruited staff by offering higher wages than their previous employer. But pinching staff is not long-term alternative to recruiting, training and retaining your own people. If new blood is not brought into the sector, housebuilders will live in constant fear of competitors and other sectors simply poaching workers back again with even higher salaries – and there still won’t be enough people to build all those houses.

Social housebuilders are in general much better at training than private firms, according to professor Linda Clarke who headed the study. So what lessons do they have for their profit-making counterparts? Ending construction’s culture of short-term thinking is a key step, says Tom Clay, director of regeneration at housing association Arena. “We need to invest,” he argues. “That’s always difficult for companies, who think ‘where’s the immediate payback?’ But we have to take the long view; we have to think of the future of the industry.”

But Pierre Williams of the House Builders Federation argues that housebuilders are already putting in a lot of effort – what’s needed is government support and a streamlined planning system. So what does he think of Professor Clarke’s findings? “It’s hard to disagree with the recommendations, but I’d say they’re relevant to other areas of construction too. They don’t in themselves address why housebuilding seems to have greater difficulties.”

So how does he explain it? “It’s difficult to see why housebuilders should be more affected, other than the fact that the sector has been affected by the cyclical nature of the housing market. In the late 80s there was a decline in housebuilding so there was a loss of skilled tradesmen at that time.”

What do housebuilders themselves think of the report? Redrow admits the company will be looking to introduce some of the recommendations (see “Action plan”, below), saying: “We can always do things better.” Barratt claims it already carries out most of the ideas in the report, adding: “We are not immune from these recruitment difficulties, but having the foresight to invest in training is now paying big dividends.”

Other companies were not so forthcoming, with many refusing to answer questions about the report’s recommendations and instead choosing to emphasise their apprenticeship schemes.

This reflects one of the report’s main themes – staff retention is a hugely neglected area. Whereas drawing people into the industry has been widely recognised as essential for some time, the importance of listening to and valuing staff once they’re on board needs much more work. Although 76% of companies in the report have a training plan, less than a quarter have a properly implemented staff recruitment and retention plan – and just 47% conduct exit interviews to find out workers’ reasons for leaving the company.

A small minority of companies are untroubled because they treat their staff well, but most housebuilders need to pull their socks up, according to Clarke. “We interviewed a lot of companies who said they sought applicants but couldn’t find people,” she says. “Companies that have a lot of applications do so because they are the rarity – they have targeted recruitment efforts, good training and so on. The ‘best practice’ firms we surveyed reported benefits such as lower labour turnover, better retention of key staff, an increasingly skilled workforce and better business performance. But these firms are the exception within the industry.”

Housebuilders’ attempts to boost recruitment are not going to get any easier. Without some blue-sky thinking – and a lot of hard work – those order books that the government is so keen to keep full are going to become a very big headache.