Workload decline sparks renewed fears of skills shortage

20 November 2008

Employers are being urged to develop their workforces to prevent a ‘significant loss of skills’ amid a sharp decline in work on the strategic and local road networks and impending job cuts.

Third quarter results from the Civil Engineering Contractors Association’s workloads trends survey show a 15% decline in workload on local roads compared with 12 months ago, and a 22% drop in work on the strategic road network. Expectations for the following 12 months have also weakened sharply.

A spokesman for CECA said small and medium-sized companies were declining faster than in July, and many were expecting to make redundancies, adding to the 3,000 or so job cuts over recent quarters.

The decline in workload has also taken its toll on May Gurney, which has announced plans to cut jobs in its civil engineering operation.

The job losses will be concentrated in Norfolk, where the majority of the contractor’s ground piling, civil engineering and associated support functions are based.

However, the contractor’s core markets – including highways and municipal environmental services – continue to be resilient to the effects of the current economic downturn. Said chief executive Philip Fellowes-Prynne: ‘Unfortunately, the same cannot be said for those of our services which are directly connected to the private sector housing and civil engineering market, where we have experienced a decline in business and see no prospect of recovery in the medium term.’

Rosemary Beales, CECA director, warned that a further steep decline in work resulting in redundancies would mean a loss of vital skills. ‘Cut back now, and construction will cost more, as those skills have to be replaced when the market recovers.’

Bob Donaldson, president of the Technical Advisors’ Group, said: ‘We’ve struggled to build a skills base since the last recession, and we were just beginning to see an increase in graduates coming through.’ However, he suggested that the current skills shortage was also behind declining workloads. ‘Money in regional budgets isn’t being spent, and the Department for Transport is struggling to turnaround workload, partly due to skills pressures.’

Sue Stevens, director of education at the Institution of Highways and Transportation, warned that, despite indications that UK infrastructure would continue to receive significant levels of government investment, many organisations would have to reassess their workforces due to the speed and force of the downturn.

‘This could potentially lead to a significant loss of skills as more established and experienced members of the sector find they are required to move outside the profession looking for new opportunities,’ she added. ‘IHT encourages organisations to ensure that they continue to retain and develop their workforce as infrastructure development will be a key factor in recovering from any economic downturn.’

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