How Wales can make the most of construction

“Construction is a really big part of our economy – it represents over 100,000 jobs and is actually a bit more vibrant,” said Vaughan Gething, minister for the economy in the Welsh government.

“There is of course a lot of difficulty at the moment. We have all the predictions of recession, magnifying the real challenge of what business investment looks like, and other issues such as the labour and skills shortages. At the same time, it is important we are not losing sight of the fact it is a sector with a very real upside.”

Gething was speaking at the Building the Future Commission’s final regional roundtable for 2023, which took place last month in Cardiff and focused on the construction landscape in Wales, exploring the opportunities, risk factors and solutions for the sector.

Since the start of the year, the Building the Future Commission has been working to discover solutions and initiatives to improve the built environment. The project does not focus on one area but instead is divided into eight workstreams focused on different aspects of the industry.

As part of the commission’s fact-finding work, and in partnership with Constructing Excellence, we have been travelling around the country convening high-level roundtable discussions with experts in different regions to ensure that the commission hears from all corners of the UK.

The first of these saw Building gather a group of experts who each have links to the East of England for a chat about skills in a region that some see as living in London’s shadow, before the commission’s roadshow headed to Newcastle to hear from those in the North-east on net zero.

The next two events were held in Manchester and Birmingham, focusing on the opportunities and challenges of devolution and the levelling up agenda.

The fifth and final stop for the year in Cardiff, chaired by Building’s editorial director Chloë McCulloch and supported by AtkinsRéalis, was made up of construction leaders all of whom have strong connections to the region and bring with them a high level of local knowledge and experience.

The challenges

“There are opportunities around retrofit; there are people in this sector who are committed to its future. I’m interested in how we accept and recognise what the challenges are and then reflect what we think the opportunities are. In my role as minister, I want to be clear about both sides of that,” Gething continued.

At this point in the conversation, talk turned to the industry specialists to identify both their key concerns and solutions (see recommendations box) with some of the core concerns identified including procurement challenges, particularly for SMEs, and the ongoing skills and labour shortages.

Ann-Marie Smale, managing director of Powell Dobson Architects, said that in a small or medium-sized enterprise (SME) the current procurement routes in Wales are prohibitive.

She said: “What we don’t do well is the actual joining up. All the local authorities approach procurement in a different way. For example, there are a million frameworks you could get on but it’s a crazy amount of resource of time for SMEs to get on.”

She added that if there was a better joined-up system, there would be efficiencies gained in the procurement process.

Ed Evans, director of the Civil Engineering Contractors Association (Wales), said SMEs are beginning to view working for the public sector in Wales as too risky due to procurement and fixed project costs and this needs to be addressed.

“I don’t think we should shy away from that, because it has the potential to create opportunities through the supply chain, but if processes are too bureaucratic we’re losing the opportunity of that public sector spending going to the SMEs.”

On this point Jane O’Leary, sector director for education at ISG, agreed that while the Consortium of Local Authorities in Wales (CLAW) has tried to come up with a coherent approach for not only procurement but also MMC use and project delivery, there is definitely an opportunity to be seized if a unified system can be developed in these areas.

The opportunities

When it comes to skills, Anthony Rees, regional manager at Cyfle Building Skills, said that while training courses and pathways are attracting more than enough people, the attrition rate is extremely high – meaning that if the issues in the system are addressed there could be a significant pipeline of new workers.

“I deal with five colleges in my role, and the transition rate into full-time work is 30%,” he said. “We need to be a bit more selective. I think more money needs to go towards the transition process and for the transfer into meaningful jobs, not at the front end of recruitment. We need more pathways into anchor organisations.”

Sean Taylor, planning manager at Dandara Homes, agreed that there are significant gains to be made in the Welsh labour market if diversity and inclusion are considered more fully. “There are pools of talent out there that have not been tapped either fully or at all.”

He said the Royal Town Planning Institute has been trying to engage with women and people from different cultural backgrounds, focused on “spreading the word about opportunities in the sector and measuring the gap response that comes back”. There is much the sector could do in this arena, he added.

One of the opportunities identified by the panel was the potential for meaningful social value delivery if companies are better held to account, with Catherine Griffith-Williams, chief executive of Construction Excellence Wales, saying that the Well-being of Future Generations (Wales) Act (see panel) is a prime example of this. “When you look at it, no one is asking for the data. But if we have a joined-up repository of data and examples of good practice, it shows what the sector can do. It can inspire.”

Grace Day, infrastructure and construction solicitor at Geldards, concurred that tracking progress is key for harnessing regulatory opportunities. “You can put clauses in contracts, but that doesn’t guarantee things are being delivered. When it comes to the Well-being of Future Generations (Wales) Act, at the moment it feels like there has been a lot of talk but not any real significant opportunity. That does mean there is still an opportunity to be harnessed there.”

The solutions

As the roundtable approached its end after an hour and a half of vigorous debate, the panel were asked to come out with proposals for the Building the Future Commission on the best solutions for the Welsh construction sector.

 Responses (see panel) included suggestions on visibility of pipeline, how to enable change within the construction supply chain, what is needed to maximise true social value, and the importance of broadening the search for skills.

The key takeaways for the commission from the Welsh roundtable were on the significance of procurement, the importance of knowledge-sharing, and aligning aims across all parts of the sector, including training providers.