Following the recent General Election, the Labour Party has secured a five-year term and set the stage for potential changes in the residential construction sector.
But, with ambitions that include the construction of an average 300,000 new homes each year set against a decline in the numbers of people employed in our industry, there are questions about how such target-driven progress can be achieved? Read on for a brief overview of the current situation and the new government’s plans.
Labour’s ambitious goal
Both the Labour and Conservative parties emphasised housebuilding in their manifestos but now that Labour oversee government, it is down to them to live up to their pledges. That means taking measures to get the country building 1.5 million new homes over the next five years – an average of 300,000 per year.
Considering whether this is feasible or not, it’s worth bearing in mind that, in the past two decades, the highest number of homes built in a single year was 215,000 in 2008 and yearly averages are significantly below that peak.
To meet their goals, the government will have to find a way of increasing annual output by 39% compared to the best performance of the last 20 years!
Just one problem – who is going to build all those houses?
Many people believe the target numbers are unrealistic due to the shortage of skilled and unskilled labour in our industry. Data from the Office for National Statistics (ONS) highlights that there has been a decline of 400,000 construction workers since 2019, with the blame for this falling jointly on the post-Brexit labour market alongside a poor uptake of apprenticeship schemes that’s led to an aging workforce without sufficient new entrants.
How to bring about change?
The incoming government obviously means a change in personnel – key positions being the new Chancellor, Rachel Reeves, and new Housing Minister, Matthew Pennycook. In the five years before Matthew took on this role, there have been nine different Housing Ministers. Such rapid turnover is likely to have impacted on the department’s ability to instil policies that could have addressed the shortfall in housing output and so the first hope now is that, as a longer-term appointment, Matthew Pennycook can start to drive notable change.
As for the new Chancellor, Rachel Reeves, early indications of change are promising, as she has already announced several housing-related initiatives, including:
- Reinstating minimum housebuilding targets
- Reviewing green belt boundaries
- Hiring three hundred additional planning officers
- Reforming the national planning policy framework
Meanwhile, the construction industry cannot afford to sit back and wait. It must play its part in giving building targets a chance – firstly by revamping apprenticeship programs to ensure they provide the skills needed now and in the future; and secondly engaging with the government to secure investments and enact legislation that can support workforce growth.
A positive outlook for the next five years?
These initial steps suggest a potential for meaningful reform in the construction industry over the next five years. If these measures are effectively implemented, they could mark the beginning of a much-needed transformation in housebuilding.
What do you think? Let us know your thoughts about the housebuilding targets and potential policy changes by commenting on our Facebook or LinkedIn pages.
15.07.2024
Feature image: Tana888/Shutterstock.com
