The UK construction industry is so far facing a year of significant hurdles. With sustainability targets becoming more stringent, economic pressures mounting, and legal regulations evolving, companies must navigate an increasingly complex environment. Understanding these challenges is crucial for developing strategies to mitigate risks and ensure successful project outcomes.
Below, Griffiths & Armour Head of Construction, Emma Snelson outlines the challenges confronting the construction sector this year.
What challenges is the UK construction industry currently facing?
The key challenges currently facing the construction industry are:
- Sustainability Drives: The industry is expected to adopt sustainable methods and materials to ensure the UK can meet its 2050 Net Zero pledges and meet companies’ ESG targets. Unfortunately, many of these methods and materials are not cost-effective when compared to traditional construction and, in practice, adopting these is often a significant issue for project teams.
- Economic Landscape: Struggles regarding managing risks associated with labour shortages, retention of skilled workers, historical recession and the increasing number of contractor insolvencies the UK construction market.
- Changes in the Legal Landscape: Staying informed and compliant with updates to the Building Safety Act is critical. The Act places additional onus and liability on many stakeholders in the sector, meaning it is essential to uphold compliance and safety standards to remain compliant.
Despite these challenges the new Labour government has committed to make improvements for the UK construction industry, including:
- Building of 1.5 million new homes
- Establishing a National Wealth Fund for development and infrastructure
- Improving rail connectivity across the North West of England
- Maintaining Britain’s road network
Other commitments that should have a positive impact are the updating of compulsory purchase compensation rules to speed up building projects and establishing a youth guarantee for training and apprenticeships.
The UK construction industry has reacted optimistically and is keen to see how quickly the new government intends to tackle the lack of affordable housing and the shortage of skills needed to deliver plans for achieving net zero.
Having the correct insurance programme and advisers in place for your construction project can create certainty, help manage costs and build stakeholder confidence.
Areas to consider:
- New build construction projects (Residential, Commercial, Hotels, Education)
- Building sustainably
- The use of timber
- The Building Safety Act
- Modern methods of construction
- Latent Defects
For further information or support, please get in touch.
Whilst care has been taken in the production of this article and the information contained within it has been obtained from sources that Griffiths & Armour, an Aon company believes to be reliable, Griffiths & Armour, an Aon company does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of the article or any part of it and can accept no liability for any loss incurred in any way whatsoever by any person who may rely on it. In any case any recipient shall be entirely responsible for the use to which it puts this article.This article has been compiled using information available to us up to 2 August 2024
