Are efforts to strengthen construction’s workforce joining up?

Skills shortages are one of the defining, long-term challenges facing construction. Recent BCIS polling found that around one-third (34%) of construction professionals expect labour availability to fall over the next 12 months.

Against that backdrop, recent reports suggest the conversation is beginning to shift. The focus is no longer simply on how many workers the industry needs, but on whether government, industry and education providers are becoming better aligned in developing future capacity.

While there are signs of progress, significant challenges remain around workforce intelligence, employer confidence and regional delivery.

Several assessments of construction skills and the measures designed to address shortages have been published in recent weeks, providing an opportunity to assess where the industry stands.

The visibility gap

The National Audit Office’s (NAO) recent Increasing Construction Skills report provides perhaps the clearest assessment yet of where current policy falls short⁽¹⁾. The report concludes that the government’s £625 million construction skills package, launched in March 2025, was not designed to resolve all labour shortages and is expected to address only part of the additional workforce needed to meet national housebuilding and infrastructure ambitions.

More fundamentally, the NAO argues that the government still lacks a sufficiently detailed understanding of future workforce requirements. It found departments have yet to model different workforce scenarios or fully assess how many workers with varying skills enter the sector from different routes.

The report also illustrates the scale of the challenge. Around 42% of the additional workers expected from the package depend on improving student employability through optional industry placements for eligible further education students. Meanwhile, just74 people started construction foundation apprenticeships in 2025/26, compared with the Department for Work and Pensions’ (DWP) assumption of 1,000.

The NAO has also cautioned⁽²⁾ that without stronger workforce planning, labour shortages could continue to increase construction costs and delay major projects.

These findings reflect wider industry concerns. A recent Business Desk⁽³⁾ roundtable described the construction skills landscape as fragmented and difficult to navigate, arguing that employers, learners and training providers often struggle to understand the routes into the sector. Participants highlighted devolution as an opportunity to bring together what remains a complex and often disconnected skills ecosystem.

Reasons for optimism

If the NAO highlights where the system remains weak, Skills England’s latest Annual Skills Report offers evidence that progress is beginning to emerge⁽⁴⁾.

The report points to a growing number of regional partnerships designed to better align education with employer demand. These include the launch of the Industry 4 Council (I4C) in Kent and Medway, an employer engagement forum for providers to connect with small and large businesses that is facilitating the delivery of key infrastructure projects for the South East region.

Other initiatives include a new facility at Wigan and Leigh College to train year 10 and 11 learners in Level 1 construction courses and a provision map of the regional construction curriculum offered across 16 colleges in the West Midlands by Dudley College. Skills England also highlights its collaboration with Jobcentre Plus and the Construction Industry Training Board (CITB) to improve routes from training into employment.

Moreover, the report stresses that construction training is comparatively well aligned with labour market demand. While only 29% of employed recent further education leavers overall go on to work in priority occupations, building and construction courses achieve a higher rate of 38%. The picture is even stronger for apprenticeships, with more than three-quarters of construction apprenticeship completers entering priority occupations.

However, Skills England makes clear that further progress will be needed. Construction is among the sectors projected to need the most additional workers over the next 10 years.

Meeting that need will require more than attracting new entrants. The report argues that supporting the existing workforce to develop new skills will be just as important as expanding apprenticeships and other education pathways, particularly as technology continues to reshape the sector.

Learnings from the industry

The relationship between skills, employer confidence and future workloads was also a recurring theme during the House of Lords Built Environment Committee’s recent inquiry into new towns⁽⁵⁾.

Jonathan Mitchell, deputy director at Skills England, described construction skills shortages as a potential delivery risk for the government’s new towns programme, which requires the right mix of trades and technical professionals to succeed. He said a clear pipeline of work would give employers greater confidence to invest in skills and new technologies while advances in technology are likely to reshape future skills requirements and could create new routes into the industry through different training pathways.

The session also underlined significant regional differences in skills planning, with some areas lacking the institutional capacity to engage with Skills England. Strengthening regional partnerships and improving understanding of local labour market needs were identified as important opportunities to better align skills provision with future investment.

Other speakers reinforced similar themes. Simon Rawlinson, deputy chair of the Construction Industry Council and BCIS Tender Price Index panellist, described the new towns programme as an opportunity to develop the new skills the industry will need in future. On a broader level, he suggested that the immediate challenge with skills is one of need rather than demand. While long-term workforce projections are credible, employers are unlikely to recruit at scale until workloads become more certain, and the need more urgent.

Sam Egan, group director of construction at Bedford College Group, emphasised the importance of stronger employer involvement throughout training to ensure learners leave education better prepared for work on live construction sites. Employer feedback reportedly indicates learners need to be more work-ready on completion of their courses, with greater exposure to real working conditions.

A more coordinated approach, but more work to do

Responding to recent reports and industry commentary, Dr David Crosthwaite, chief economist at BCIS, said that while good progress has been made, the government should prioritise creating the conditions that enable employers to invest in people, and develop a clearer understanding of where the most pressing skills gaps exist.

‘It’s easy to become too focused on the numbers and the variation between them,’ he said. ‘For example, the Construction Industry Training Board’s latest outlook estimates that an additional 41,200 workers will be needed each year between 2026 and 2030 to meet forecast demand.

‘At the same time, Skills England estimates that around 493,000 additional workers will be needed across construction priority occupations by 2035, alongside a further 595,000 replacement workers to offset those leaving the industry over the same period. These estimates provide useful context, but what matters is how quickly and effectively government and industry respond.

‘Arguably, the most important lever is creating the right business environment for employers. Many firms are currently operating in a persistently challenging market. Demand remains subdued, confidence is weak and the project pipeline lacks certainty. For many businesses, particularly SMEs, there is little incentive or capacity to take on apprentices, recruit new staff or invest in developing their existing workforce.

‘If the government wants to tackle the skills challenge, it must create conditions that give employers the confidence to invest. Measures that reduce the cost of employment, provide greater certainty around taxation and borrowing costs, and improve confidence in future workloads will all be important.

‘There needs to be a much better understanding of where the skills shortages actually exist too. Recent National Audit Office findings suggest the government has not consistently modelled where future skills gaps are likely to emerge. Improving this evidence base should be a priority, alongside greater engagement with construction businesses of all sizes to understand the challenges they are experiencing on the ground.

‘Our own tender price panels, composed of cost consultants involved with multiple tenders each quarter, suggest that current capacity constraints are largely concentrated in finishing trades and mechanical, electrical and plumbing (MEP) work. However, those pressures change quickly as project pipelines evolve. Construction has always relied on a degree of labour mobility and flexibility because workloads fluctuate and project timings change.

‘The objective should therefore be to create an environment in which employers can recruit quickly if demand increases, while also encouraging greater long-term investment in attracting and developing new talent through education and training.

‘There is also an opportunity to strengthen devolved approaches to skills as regional governance continues to evolve. Labour shortages are rarely uniform across the country, and giving regional authorities greater influence over skills planning and funding could help ensure that training provision is better aligned with local labour market demand.

‘There is already a great deal of positive work taking place across the government and the industry. The goal now is to maintain that momentum while establishing a stable and predictable economic environment. If business conditions improve alongside a strong pipeline of new entrants, the industry will be in a much stronger position to meet future demand.’

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^{(1) National Audit Office – Increasing construction skills  - here}

^{(2) National Audit Office – Employer confidence is critical to construction skills package success, NAO says  - here}

^{(3) The Business Desk – The biggest issue in construction and development is skills  - here}

^{(4) GOV.UK – Skills England annual skills report 2026  - here}

^{(5) Parliamentlive.tv – Built Environment Committee - here}