Last edited 31 Oct 2016

UK construction industry

Contents

[edit] Introduction

Construction is a very diverse industry that includes activities ranging from mining, quarrying and forestry to the construction of infrastructure and buildings, the manufacture and supply of products, as well as maintenance, operation and disposal.

Construction output in the UK is more than £110 billion per annum and contributes 7% of GDP (ref Government Construction Strategy). Approximately a quarter of construction output is public sector and three quarters private sector.

There are three main sectors (ref Government Construction Strategy):

  • Commercial and social (approximately 45%)
  • Residential (approximately 40%)
  • Infrastructure (approximately 15%)

Approximately 60% of construction output is new build, whilst 40% is refurbishment and maintenance.

The industry accounts for approximately 3 million jobs, 10% of total UK employment (ref Construction 2025) and includes both manufacturing and services. According to the Department for Business Innovation and Skills, the industry is made up as follows:

  • Contracting, 2,030,000 jobs, 234,000 businesses.
  • Services, 580,000 jobs, 30,000 businesses.
  • Products, 310,000 jobs, 18,000 businesses.

Ref BIS, UK Construction, An economic analysis of the sector, July 2013.

Construction is a high cost, high risk, long-term activity, and so it's performance is a good indicator of the heath of the wider economy. When the economy falters, construction investment grinds to a halt, but when the economy begins to recover, the construction industry can quickly overheat.

[edit] Leadership and governance

Construction comes within the remit of the Department of Business, Innovation and Skills. However, planning and building regulations fall under the Department for Communities and Local Government. To further confuse matters, the Government Construction Board reports to the Minister for the Cabinet Office and the Cabinet Office is also the home of the Efficiency and Reform Group which includes the Major Projects Authority.

The abolition of the role of Chief Construction Adviser in November 2015, and the taking over of responsibility for the Government Construction Strategy by Cabinet office minister Nick Boles has made the position even more confused.

In addition, a Construction Leadership Council (CLC) was established in 2013 to oversee implementation of Construction 2025: industrial strategy for construction. This is an industry / government council jointly chaired by the Secretary of State for Business, Innovation and Skills and an industry representative.

Other organisations also have involvement in the governance of construction:

See Statutory consultees and Non-statutory consultees for more information.

In addition, the industry has established numerous boards, councils, institutes and associations to lobby, develop, promote and regulate construction activities:

For more information see: Construction industry institutes and associations.

A number of these institutes and associations are members of the Construction Industry Council (CIC) which describes its mission as providing ‘…a single voice for professionals in all sectors of the built environment

[edit] Criticism

The UK construction industry is regularly criticised for being wasteful, adversarial, fragmented, dominated by single disciplines, reluctant to innovate and poor at disseminating knowledge (See Construction industry reports for more information). However, given that despite a great number of reports about the industry, and numerous attempts to improve efficiency, the perception or poor performance persists, it might be inferred either that; under the circumstances the industry operates more effectively than it appears from the outside; expectations are unrealistic; or recommendations have been consistently poorly implemented.

[edit] Challenges

The UK construction industry faces a number of very serious challenges:

[edit] Urbanisation

In 1900, only 13% of the population lived in urban areas. Over half of the planet's population now lives in cities. These densely occupied areas should be more sustainable than more dispersed rural settlements, but in fact they account for more than 75% of the consumption of non-renewable resources, and create around three quarters of global pollution.

By the second half of the century, more than 70% of us will live in cities, and at the same time global population will increase from 7 billion to around 9.5 billion. If we are to accommodate this growth whilst at the same time reducing overall consumption, our design and construction needs to become much smarter. See Smart Cities for more information.

[edit] Climate change and sustainability

The UK government has committed to cut green house gas emissions by 80% by 2050 compared to 1990 levels, and to halve them by 2025. In 2009 buildings accounted for about 43% of all the UK’s carbon emissions (ref DCLG). If the government commitment is to be met, our buildings must become considerably more efficient. This is made more complicated by the fact that around 80% of the UK building stock that will exist in 2025 has already been built, along with two thirds of the housing that will be occupied in 2050.

Not only does our building stock need to become more efficient, if the climate changes as projected, it will also need to become more resilient.

However, government policy, such as scrapping the Green Deal, dropping plans for zero-carbon homes, and reducing subsidies for renewables would seem to be contrary to these goals.

[edit] Government construction strategy

The Government Construction Strategy has set in motion two major initiatives:

  • An intention to achieve savings of 15 to 20% by the end of the parliament.
  • A requirement for fully-collaborative 3D BIM on all centrally-procured construction contracts by 2016.

See Government Construction Strategy for more information.

Some of these targets have been developed and extended by Construction 2025.

[edit] Performance gap

There is significant evidence to suggest that buildings do not perform as well in practice as was anticipated at the design stage. The difference between anticipated and actual performance is known as the performance gap.

Findings from the PROBE studies (Post Occupancy Review of Buildings and their Engineering) demonstrated that actual energy consumption in buildings will usually be twice as much as predicted. More recent findings from the Carbon Trust‘s Low Carbon Buildings Accelerator and the Low Carbon Buildings Programme have demonstrated that in-use energy consumption can be 5 times higher than compliance calculations.

See performance gap for more information.

[edit] Procurement

Typically a construction project will involve a funder, a client, consultants, a contractor, sub-contractors and suppliers. They will generally be procured following one of the five main procurement routes:

For more possibilities see: Procurement routes.

A typical traditional contract will include the following stages:

Other stage definitions can be seen in comparison of work stages.

[edit] Find out more

[edit] Related articles on Designing Buildings Wiki

[edit] External references

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