Construction training investment welcomed but workforce pressures remain

The government has announced a £96 million funding package to create tens of thousands of construction placements across England, as part of wider efforts to tackle skills shortages and support housebuilding targets⁽¹⁾.

The funding will support learners starting construction courses from September and is intended to increase hands-on industry experience and improve employability. The announcement also forms part of wider post-16 education reforms, including new V Levels and additional construction qualifications in areas such as bricklaying, plumbing and construction design.

The latest measures build on the government’s broader apprenticeship and skills overhaul announced earlier this month⁽²⁾, which includes £2.5 billion of investment through the Youth Guarantee and Growth and Skills Levy over the next three years.

For smaller firms, the reforms include government covering the full apprenticeship training costs for eligible under-25s from August 2026, alongside recruitment incentives worth up to £3,000 for some new hires. Additional regional funding is also intended to give local areas greater influence over aligning training provision with labour market demand and regional project pipelines.

Commenting on the announcement, BCIS chief economist Dr David Crosthwaite said the investment was welcome, but warned the sector’s workforce challenges run deeper than training numbers alone.

‘While additional investment in construction training is a positive step, the latest workforce figures highlight the more complex challenge facing the sector,’ he said.

‘Although the overall construction workforce edged up in the first quarter of 2026 compared with the previous quarter, this was driven by a 6% rise in self-employment, while the number of employed workers fell by 3%.’

The figures point to an industry where businesses are still relying more heavily on flexible labour while remaining cautious about permanent recruitment.

Construction vacancies are down 12.5% year-on-year and the sector currently has one of the lowest vacancy ratios in the economy, at 1.8 vacancies per 100 employee jobs.

‘The wider picture also shows continued fragility in market conditions, with the total workforce 4% smaller than it was at the start of 2025, and 14% below levels seen 20 years ago,’ Dr Crosthwaite said.

‘Vacancy rates suggest firms may be exercising greater caution around recruitment amid subdued workloads and ongoing viability pressures.’

Alongside lower recruitment activity, the industry is facing the longer-term challenge of replacing experienced workers leaving the sector, particularly across senior commercial, technical and project delivery roles.

‘One of the biggest longer-term concerns is the loss of industry expertise and experience that cannot quickly be replaced through new entrants alone,’ Dr Crosthwaite said.

‘While expanding training provision is important, rebuilding capability across senior commercial, technical and project delivery roles takes time.’

The reforms are intended to strengthen vocational education pathways and improve the flow of skilled workers into sectors critical to economic growth, including construction.

However, firms across the supply chain are continuing to balance recruitment decisions against weaker workloads, tight margins and uncertainty around future project pipelines.

‘At the same time, firms continue to face rising costs, financing pressures and wider increases in operating expenses, making confidence and a stable pipeline of work critical to supporting long-term recruitment and retention,’ Dr Crosthwaite added.

To keep up to date with the latest industry news and insights from BCIS register for our newsletter here.

^{(1) Office for National Statistics – Regional funding to train next generation of construction workers – here}

^{(2) Office for National Statistics – PM vows to tear up “status quo” that failed young people on apprenticeships and skills  - here}