2020 vision: Looking ahead to the new year in the construction industry
On the dawn of a new year and a new decade, three of our regional leads, Debbie Ward, David Ford and Stuart Francis,and framework manager Faye Haldane came together over coffee to discuss their thoughts on the construction industry in the next 12 months.
Using their collective knowledge and regional expertise, the group outlined three potential opportunities and two challenges facing construction companies in 2020.
Opportunity: A drive in infrastructure projects
In his electoral campaign, Prime Minister Boris Johnson set out his agenda for an ‘infrastructure revolution’ – a £100bn fund spent over a five-year period.
“Worldwide political uncertainty during 2019 weighed heavily on the minds of decision makers in terms of investment priorities,” said Stuart, regional lead for the south west.
Following the 2019 general election, Mr Johnson now has a platform to deliver on these promises and push through funds for major infrastructure projects.
As part of the fund, the government is set to commit to the Northern Powerhouse Rail and the Midlands Rail Hub projects and decisions will soon be made on the HS2 and Hinckley Point C projects.
David, regional lead for the East Midlands said: “It is in the national interest to advance infrastructure across the region and we have been encouraged by the promises to commit to high spending.
“Major infrastructure projects that are currently in their early stages can now be prioritised and the increase in funding will help deliver not only much-needed housing but improvements to our aging road and rail networks.”
Challenge: Tackling the skills shortage
“A consequence of Brexit will be the anticipated skills shortage stemming partially from the UK’s dependence on outsourced labour,” warns David Ford.
While this is a going to be a key challenge for the industry Faye Haldane argues that this creates an area of focus for the industry as a whole and an opportunity to spark passion in young people as well as target rising stars with transferable skills into the industry.
She added: “We also have an opportunity as an industry to lead the way in adding social value to local communities through employment opportunities, training for local people, and working with SMEs to tackle the skills gap.”
Opportunity: Unlocking more housing prospects through air rights
With available land in major towns and cities across the UK becoming more of a rarity, construction companies need to be smarter when it comes to redevelopment. One niche way that developers are increasingly looking to explore is buying the air rights above existing properties.
Most owners of freehold land legally own the space directly above their properties, which can be sold or leased to developers. Subject to planning permission, construction companies can then commence building on top of existing infrastructure, such as two-storey shops.
Utilising air rights doesn’t come cheap and it’s a highly specialist provision, but Debbie believes that this innovative approach to building can help address the country’s need for more housing in urban areas. “There’s an opportunity to provide smart solutions to meet the demand for much-needed housing. By investing in air rights and mixing light industrial spaces with affordable housing, we can adapt existing buildings for conversion and unlock more space for housing in our densely populated areas.”
Unlike building from the ground up, new housing development can be sewn into existing infrastructure and, as modular building techniques improve, more properties are now suitable for air right development.
Challenge: Lowering the industry’s carbon footprint
In 2019, the UK set a target to bring all greenhouse gas emissions to net zero by 2050. It’s an ambitious target, which will force developers to change the way the industry works. Currently, 42% of the country’s carbon emissions are attributable to the built environment, according to the UK Green Building Council.
Debbie said: “It’s crucial that the construction industry works together to lower its carbon footprint, alongside providing a built environment that’s adaptable and resilient into the future. Extreme weather conditions and rising sea levels will increasingly be an issue and it’s vital that our sector recognises the impacts and acts accordingly, both in terms of working towards preventing further climate change, and minimising risk to assets by delivering appropriate buildings, place and infrastructure moving forward.”
As we move into 2020, Debbie believes it’s the companies that are the quickest to adapt that will thrive: “I think that those that make changes now will reap long-term rewards, staying ahead of the curve before regulations and legislation forces it.”
The task of lowering the industry’s carbon footprint, along with designing a future-proofed built environment, is huge and one that Perfect Circle is committed to tackling. As such, the consultancy will be delving into the issue further in an upcoming blog post.
Opportunity: The digital revolution
Dubbed Industry 4.0, the fourth incarnation of the industrial revolution is digitising manufacturing and modernising how the construction industry operates.
The rollout of 5G across the UK will enable greater connectivity between supply chains and live sites.
“The digital revolution provides us with an opportunity to consider in more detail not only how buildings are designed and built,” says Faye.
“It will also improve supply chain efficiency, as more suppliers start integrating smart machines into their manufacturing process. These machines will be able to instantly analyse thousands of GB of data, enabling improved tracking of materials.”