What could the trades skills shortage look like in 2030?

A recent study by Simply Business has revealed a worrying 35 per cent decline in new tradespeople choosing self-employment.

The data, which looked at insurance quotes requested in 2023 compared to 2019, reveals a stark future for the construction industry unless significant changes are made.

The research aligns with a recent report from Kingfisher, owners of B&Q and Screwfix, which predicts a shortfall of 250,000 tradespeople by 2030.

Which trades could be most affected by the skills shortage?

When comparing 2023 to 2019, our data revealed the most significant decreases were in:

1. Dry lining – 57 per cent
2. Joiners – 53 per cent 
3. Builders – 51 per cent
4. Glaziers – 49 per cent
5. Tilers – floor and wall – 48 per cent
6. Bricklayers – 45 per cent
7. Labourers – 44 per cent
8. Plasterers – 44 per cent
9. Painter and decorators – 39 per cent

A productivity slowdown despite steady demand

In 2024, we’ve already seen a productivity slowdown of 1.4 per cent in the first part of the year, in part due to a lack of skilled workers.

But the slowdown in productivity isn’t linked to a lack of demand for work – in fact, the construction industry is predicted to generate £404bn of revenue this year. Which suggests there aren’t enough workers to meet demands.

This has led to an average wait time of five weeks for a tradesperson – and as high as nine weeks for roofers.

What’s causing the skills shortage?

Our industry predictions for the year told a similar story – there aren’t enough young people entering the industry to replace an ageing workforce. 

In the report issued by Kingfisher, 1,000 young people aged 16 to 25 were asked about their work ambitions and whether they’d consider a career as a tradesperson.

Almost half (49 per cent) said they wouldn’t consider a career in the trades and only 13 per cent said they were encouraged at school to consider a career as a tradesperson.

Another reason the industry is feeling the effect so severely when compared to other industries is due to the lack of diversity in the workforce. Women make up only two per cent of the UK’s 900,000 tradespeople.

What’s the impact of the skills shortage?

It’s estimated the skills shortage will mean the UK misses out on £12 billion a year in GDP opportunities, according to Kingfisher’s report. Not having enough workers to complete projects like large housing estates or redeveloping high streets might make certain areas of the economy stagnate.

Bea Montoya, UK COO at Simply Business, shared similar concerns: “Small business owners are the backbone of the UK economy, and few embody this more than the nation’s tradespeople. They’re quite simply vital for our local communities, and together with other small businesses across the UK, collectively contribute trillions of pounds to the economy.”

The report found one in five tradespeople have had to turn down or postpone work because they don’t have the staff to complete the job.

The broader economic strain on businesses as a result of the cost of living crisis is also making it difficult for these businesses to grow. Data from our SME Insights Report revealed that 23 per cent of business owners are putting off hiring new employees because of rising costs. 

As a result, even if a business wants or needs to hire a new employee, many might not want to risk it because of the increased operational costs they’re facing.

What’s being done to solve it?

Since the change in government at the general election, Labour have shared their plans for solving the skills shortage, while also hoping to rejuvenate construction. 

To try and make it easier for young people and small businesses to make the most of apprenticeships, they’re looking to replace the current Apprenticeship Levy with a Growth and Skills Levy. The government say this will allow for more flexibility in how small businesses train their workforce, and attract more young people to the industry. 

The government has also announced their strategy for new constructions projects, with plans to: 

• build 1.5 million new homes, creating opportunities for small businesses and tradespeople
• strengthen planning capacity by hiring more than 300 new planners across the public sector
• reduce red tape in the current building planning system

Brian Berry, Chief Executive of the Federation of Master Builders (FMB), emphasised the important role small builders will play in these plans: “Bringing SMEs on board with new town development will ensure high quality and diverse housing is delivered, while also creating wider benefits, like vocational skills opportunities.”

Kingfisher’s report laid out three strategies the government could focus on to help more young people consider a career in the trades:

1. Career advice in schools to encourage young people to take up a trade career
2. Improved hiring incentives to support SMEs in taking on, training, and retaining apprentices
3. Cost of living support to make sure trade apprenticeships are financially viable for young people

Have you experienced a skill shortage when hiring for your business? Let us know how it’s affected your business in the comments below.

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