, Building
You priced the brickwork on a 22-unit scheme at £520 a thousand, based on the gang you have used for four years. That gang is now on a distribution shed outside Wakefield until March. You ring six agencies. Two do not have anybody. Three quote a day rate that puts you £14,000 over budget on the package. The sixth has two lads available immediately, which should worry you more than it reassures you.
The programme says brickwork starts on the 14th. It is now going to start in the middle of February, and everything behind it moves.
The gap is demographic before it is anything else
The construction workforce in Britain skews old. Successive workforce surveys and the Office for National Statistics labour force data have shown a large share of tradespeople in their fifties and above, with a much thinner band coming in behind them. That is not a shortage that a good year fixes. It is a long, slow subtraction that plays out over a decade as people retire.
Two things widened it. The 2008 downturn removed a cohort almost entirely: firms stopped taking on apprentices, apprentices who were part way through were let go, and a generation of people who would have qualified around 2011 went into something else and did not come back. Then freedom of movement ended, and sectors that had relied heavily on European labour, particularly in London and the South East, found the supply thinner and older.
The Construction Industry Training Board publishes an annual Construction Skills Network forecast setting out how many additional workers the industry needs to recruit to meet expected output. The figures move year to year, and they are estimates rather than measurements, but the direction has been consistent for a long time.
Training somebody is a cost you carry and a benefit somebody else may collect
Most contractors know the industry needs apprentices. Most contractors are not training any. The reason is not ignorance and it is not meanness.
An apprentice bricklayer is unproductive for a long time and then moderately productive for longer. Somebody experienced has to supervise them, which costs output from the person who was actually laying bricks. Then, at the point where the investment starts to pay back, the apprentice can walk to a firm down the road for another £30 a day, because that firm did not carry the training cost and can afford to pay more. Everybody understands this, which is why everybody waits for somebody else to do it.
The funding structures try to correct for that, with mixed results. The CITB levy applies to employers in scope of the construction industry and is charged on payroll, at rates set by levy order following consultation with the industry: in recent orders 0.35% of PAYE payments and 1.25% of net payments to Construction Industry Scheme subcontractors, with a small business exemption for employers below a stated wage bill threshold and a 50% reduction for a band above it. Levy payers can claim grants back for apprenticeships and qualifications, which means the money is available but only to firms organised enough to claim it.
Separately, the apprenticeship levy applies across all sectors at 0.5% of an employer's pay bill where that bill exceeds £3 million a year, with a £15,000 allowance offsetting it. Most construction firms are well below that threshold and are therefore not levy payers, which means they draw on government co-funding instead.
The structural weakness is self-employment. A large part of the construction workforce operates through the Construction Industry Scheme rather than on payroll, and a self-employed bricklayer on a day rate has no employer with a reason to train their replacement.
Day rates are the clearest information in the market
Ignore commentary and watch the rate. A day rate is a live price for a specific skill in a specific place in a specific week, and it moves faster and more honestly than any survey.
What the rate tells you:
- A trade whose rate has moved 20% in a year is genuinely short in your area, not nationally in the abstract.
- A rate that is high but stable is a structural premium, and you should price it permanently rather than treating it as a spike.
- A rate that is oddly low for a scarce trade is usually a signal about the person, not the market.
- A rate quoted with immediate availability during a busy period deserves a phone call to their last two sites.
Rates are also regional in a way that catches out firms expanding. The same groundworker costs materially more within reach of a major London project than in the North East, and travel and lodging allowances follow. If you tender across regions on a single set of labour constants, you will win the wrong jobs.
A two-person shortage stops a fourteen-person job
The damage is out of proportion to the scale. A programme is a chain of dependencies, and a trade you cannot resource is a broken link that idles everybody behind it.
Two bricklayers you cannot find for six weeks delays the roof, which delays the scaffold strike, which delays the external works, which pushes the completion date past the liquidated damages threshold. The cost is not the £14,000 you would have paid over the odds. It is that plus the preliminaries for the extended programme plus the damages plus the second job you could not start because the crew is still on the first.
This is why the firms that handle scarcity best are not the ones who pay the most. They are the ones who commit earliest. Booking a gang three months out at a slightly uncomfortable rate is a form of insurance, and the premium is small compared with the claim. Paying promptly and treating subcontractors decently is the other half of it, because in a short market the gang chooses the client, not the other way round.
The work has to be worth doing, not just paid for
Recruitment into the trades competes with every other option a sixteen year old has. Construction asks for early starts, outdoor work in February, travel, physical wear that shows up in your forties, and in many cases a self-employed status with no sick pay.
Some of that is inherent. Some of it is not. Site welfare requirements under the Construction (Design and Management) Regulations 2015 are a floor rather than an ambition, and the difference between a site with decent facilities and one without is visible in who will work there. The industry's record on mental health, and the attention it has finally started to receive, is part of the same conversation.
The firms with a stable core of tradespeople usually have unremarkable reasons: they pay on time, they keep people in work through the quiet months, and they do not treat the labour as a variable cost to be dropped in November and re-hired in March. That continuity is expensive, and it is cheaper than the alternative.
Where this shows up in the game
Construction arrives in Business Baron with the Property & Construction Track, an add-on to the full game. Towns differ in wages and in labour availability, and there are places where you cannot recruit at any price. An apprentice is an investment that goes negative before it goes positive, and pays back years later if you keep them.