download the full report.
three sides of construction.
-
2021: The year ahead post-Brexit and IR35 changes
2020 was a turbulent year for the construction industry. The dual impact of COVID-19 and Brexit has caused real uncertainty in the market, as it has across the wider world. But the sector has demonstrated its resilience, establishing itself as one of the bright spots of the economy.
As we look to 2021, we remember that construction was among the first sectors to resume activity in May 2020, bounced back quickly and effectively over summer and in some areas, saw significant growth. The support from the government in Infrastructure and Housing to build back Britain better has shown in monthly revenue figures.
The industry’s office-based workers, such as architects, quantity surveyors and sales teams, have adapted to working from home, switching to predominantly virtual meetings. But for many the home work environment has been difficult. According to research by the London School of Economics 46 per cent of people said they did not have a suitable place to work. As a result of prolonged periods of being at home, people are reconsidering their lifestyle priorities and living situations.
Searches on Rightmove over summer for people looking for homes outside of London were up to 51%, a 9% increase on the year, while the number of home searches by people in Edinburgh, Birmingham, Liverpool, Sheffield, Glasgow and Bristol looking at properties outside of their cities also rose, as lockdown provided workers with a chance to reassess what really matters to them.
The private sector is also facing the imminent introduction of IR35 legislation changes. This will affect the construction industry, which is heavily reliant on contractors to complete projects, and a lack of preparedness could see companies fall foul of HMRC. With Covid-19 still a reality of our daily life, the construction sector is experiencing a triple threat on output in the first quarter of 2021.
This report shines a light on the shifting landscape across the construction industry – as in the world at large – and looks ahead to the opportunities to be won in 2021.
-
UK Infrastructure: Build, Back Better
The Government’s current ‘levelling up’ agenda is a commitment to boost the Midlands and North of England. A key element of this agenda is an investment in infrastructure, thanks to the role it plays in boosting local economies and increasing social mobility. The Government has committed to getting Britain to ‘build, build’ build’ and to deliver on its promise to ‘level up’ the country. In a post-Brexit world, the productivity and attractiveness of UK Plc is vital to remaining competitive on the world stage. Despite investment in northern regions being a key focus, more projects are currently proposed in the South East and South West.
Of the over 15,000 infrastructure projects in the pipeline for the South East, 47% or 7,249, have guideline commencement dates of 2021. Significant projects include supporting infrastructure for HS2 in Didcot, the IFA2 interconnector between England and France, and the Lower Thames Crossing.
In the North West where over 12,051 projects are proposed, 5,169 have guideline start dates in 2021, with investments ranging from £60,000 to £10.5bn. Upcoming projects in the area include...
-
The new world of work: living costs, salaries and work/life balance
An analysis of over 7,500 permanent placed construction jobs and current vacancies show that average pay in the construction sector has been on an upward trajectory over the last five years, increasing by 24% from 2016 to 2020. The largest increase was seen between 2018 and 2019 when average salaries rose by 8.5%, from £41,476 to £44,999.
Despite the economic uncertainty of 2020, average salaries in the construction industry have increased by £3,000, a 6.5% uptick, across a range of on-site and office-based roles. Salaries in the construction sector have been rising above annual inflation in the last two years.
Our analysis shows that while London continues to provide workers with the highest average salaries in the industry at £50,630, monthly outgoings for either homeowners or renters are higher than elsewhere in the country, with average weekly livings costs of £651 and monthly outgoings of £2,885.
Workers seeking a better balance between earnings and outgoings will find that jobs in the construction industry in the North East of England have been securing average salaries of £45,875 and with outgoings 50% lower than in the capital, workers will be significantly better off.