Turning the productivity puzzle into a solution

Construction – like the UK economy – is showing signs of strain. However, the sector had a reasonably strong performance in 2022 and this came despite a steady worsening of a ‘people problem’ that has long dogged the industry.

With the total number of people working in construction falling by 10.5 percent since 2019 Q1, labour shortages have become entrenched. Schemes to attract more migrant labour for specific construction roles have been unveiled by the government and will be helpful, but not a panacea.

But there are signs the industry is learning to achieve more with less labour. Construction sector productivity – widely regarded as key to lasting growth – is finally increasing after decades of decline.

With client demand in certain sectors cooling and interest rate rises working through the economy, capital programme budgets are being squeezed – so it’s vital that the industry consolidates its productivity gains and empowers its people to deliver greater value.

Technology offers a way for the industry to get around labour market frictions and problems in attracting talent. This edition of the UK Market Intelligence will examine where and how productivity is being improved, which technologies and techniques boost efficiency most effectively, and how progress can be extended and accelerated.

At a glance