At the time of writing, the UK still looked more likely than not to legally leave the European Union in 2019, leaving many construction firms rightfully concerned for the future of their labour. Jason Knights, Managing Director of M&E specialist SES Engineering Services (SES), argues that maintaining a continuous direct labour force is the way forward for the industry, regardless of the deal secured (if any).
Construction has typically relied on temporary, often foreign workers, but Brexit raises serious questions about the viability of the industry’s future. This is particularly pertinent for firms in London and the South East where, according to the Office for National Statistics, around half of all construction workers were born overseas, many of whom may well face deportation following the UK’s departure from the EU.
Coupled with the skills shortage that is already causing our industry serious long-term concern, it is clear an alternative must be found if we are to weather the Brexit storm. One solution is for firms to rely less on contract workers and instead invest in maintaining a direct labour force.
Direct labour is something we have implemented to great success at SES, where we currently maintain about 260 mechanical and electrical operatives on the permanent payroll. While this approach may be considered unusual for a business of our size, the commercial benefits of maintaining a constant workforce easily outweigh the financial pressures.
The main benefit it brings is keeping strong teams together, moving them seamlessly from one completed project to the other. While temporary staff may be recruited to meet certain shortfalls, core delivery teams are proven to work well together, having gained experience on similar projects or from working for the same client.
Value of Continuity
For customers, such consistency is a major selling point. Having the reassurance that they will receive the same service delivered by the same team is often a deciding factor in winning repeat business, and SES often finds clients requesting certain individuals or teams to work on a new project.
A prime example of this is where SES is currently supporting delivery of a £100m aseptic manufacturing facility, the latest project in a 26-year working partnership with a leading global researcher, developer and manufacturer of pharmaceutical medicines, vaccines and consumer healthcare products.
Prior knowledge and a thorough understanding of a client’s specific needs and ways of working is invaluable. It allows for exemplary service to be delivered and significantly reduces the time that teams need to spend on-boarding.
Maintaining a large direct labour force also has a positive impact on morale and brand building. Employees value the feeling of ‘belonging’ it brings, as well as the opportunity to work continuously with people they respect. This ensures that relationships forged on long projects are not wasted.
Committing to a permanent workforce also makes it easier to uphold training programmes that support the long-term professional development of staff and justify investment in more apprenticeships. For those starting their career, learning from a consistent group of peers is invaluable and is often cited as a key benefit by trainees.
SES has proven that a direct labour approach builds a strong collaborative ethos, keeps staff turnover low and allows a culture of best practice and knowledge-sharing to resonate throughout a business. The construction industry is often accused of being slow to embrace change and modernity. By employing more personnel on a permanent basis and giving them a company umbrella through which transformation and progression can be communicated, a real step change in culture can be created.
This approach may not work for all. Maintaining a direct labour force is a considerable financial commitment and relies heavily on timings – teams need to be able to move from one project to the next to minimise downtime and work is not always guaranteed to line up smoothly. But it can offer a viable alternative to contract employment and should be a strong consideration for firms that are able to support it. While the future remains uncertain and the true impact of Brexit unknown, creating a consistent, skilled and knowledgeable workforce can bring huge benefits that make your business more resilient, come what may.
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