Ben Dyer, CEO of Powered Now, discusses the widening of the UK’s vocational skills gap and the effect of the ‘pingdemic’ on labour and material shortages in the trades, describing a “marriage made in hell as supply chains are disrupted by isolating workers and Brexit”.
With shop closures and production lines halted by the so-called ‘pingdemic’, a bout of wide-scale isolations is pushing waiting times for labour and materials to new record lengths. With the average wait time for private jobs in the trades now exceeding three months, there is genuine concern that the industry cannot keep up with demand. Field service management software for 2000 SMEs in the trades, Powered Now, is witnessing the devastating impact this is happening on the industry.
Confidence is currently sky high; the latest IHS Markit/CIPS construction PMI exceeded forecasts to jump from 64.2 to 66.3 in June. This was the highest reading since June 1997 and well above the 50 mark that separates growth from contraction. While this has fuelled vast job creation within the construction sector, there is a deep concern that demand simply cannot be met while the much of the workforce, who may not have Covid, are being told to isolate.
This means that labour will be directed to large-scale commercial work, whilst having a narrowing pool of workers for SMEs to complete their inundated workload.
Furthermore, Brexit has lengthened the supply lines for a number of core supplies from Europe. A significant majority of materials required by UK trade and construction are manufactured or processed in mainland Europe. As the pandemic swept the continent almost all major countries suffered shortages in stock; now however, manufacturers are refilling the supply chains that are closer to home first, with the UK falling to the back of the queue.
While this should have eased over time and it is encouraging to see a number of efforts to move material production to the UK, the enduring ‘pingdemic’ is exacerbating these fears. This has led to further hurt for SMEs in the trades as larger companies have been able to purchase these products at higher prices, to the detriment of their smaller competitors. With fewer sub-contractors to choose from too, the forced isolation of hundreds of thousands of Brits is further compounding the issues faced by SMEs in the trades.
At Powered Now we are delighted to witness the increase in both order books and confidence. Higher demand for construction and trade services has a real-world trickle down to small and medium trade businesses.
However, we are very worried about the implications of stress on the UK supply chain, which is being further compounded by the ‘pingdemic’. We want everyone to be safe, and therefore believe the track and trace scheme to be necessary. However, we would echo calls from the CBI requiring the government to have more of a sure-footing on free tests available to businesses, along with mask wearing in certain scenarios.
We are also especially critical of larger firms choosing to stockpile both materials and labour. The industry is only as healthy as the workforce within it, and these larger companies rely on much smaller contractors to operate, of whom are being unfairly penalised. It is incredibly shortsighted of larger firms to use their leverage over smaller ones. Not only does this hurt the economy but will eventually catch up with them due to their reliance on the SME sector for contract staff. We hope this practice, like Covid, can eventually be eliminated.
