2.2 million people work in Britain's construction industry, making it the country's biggest industry, in addition the industry operates with a significant amount of temporary agency workers, normally equating to 14% of their workforce.
Optimism among some of the construction industry's biggest companies has fallen sharply, according to the latest Construction Leaders Forum report. The unique off-the-record discussion, which brought together more than 20 senior managers towards the end of 2009, highlighted falling order books, squeezed margins and growing certainty that this year would see large companies disappear from the market. Operating with a vendor neutral provider like de Poel ensures unbiased agency selection process.
The use of temporary agency workers will continue to play a pivotal role within construction industry but with increasing skill shortages, tight legislation and pressures to improve health and safety, the need to improve control of their temporary workforce will increase during 2010.
Construction companies must improve their control and indeed cost of the temporary workforce, which is often fragmented if they are to be successful during 2010.
Further challenges presented themselves as to cope with the recession, many agencies began, cutting corners on worker-checks, manipulating pay to candidates, and upping their margins, indeed 6 recruitment agencies that supplied workers to the construction industry were fined a total of £39.27m, including Hayes, by the Office of Fair Trading (OFT) for price-fixing and the collective boycott of another company. This left construction firms open to further high costings and legal exposure, and workers vulnerable to underpayment.
There are approximately 10,000 agencies operating in the UK, with no recruitment agency owning more than 4% of market share. As well as being fragmented, the recruitment industry is largely unregulated, which means many of the 10,000 recruitment agencies in the UK do not comply with legislation, leaving their construction clients legally exposed.
Construction companies use multiple agencies across all projects for their temporary agency workers, with numerous recruitment agencies on board, construction companies are often unaware of the wide range of pay rates, fees and terms and conditions, making it an expensive and often challenging area of the business to manage and administer.
Perhaps the biggest casualty of the recession, 2008-2009 saw the construction sector experience a dramatic fall in projects alongside thousands of job losses. In December 2008, the sector shrank at the quickest pace since records began, with the biggest decline in house building due to a massive slump in the housing market. This was followed by a decrease in civil engineering and commercial contracts, which also fell at record rates. By March 2009, architects were claiming benefits faster than any other profession, alongside surveyors, engineers, bricklayers, carpenters and scaffolders, cited in the top 20 professions to have seen the biggest increase in benefit claimants.
As the recession took hold, workload for construction companies collapsed faster than at any time since the 1980s, and to survive the downturn, many construction companies resorted to reducing their expenditure on back-office functions such as recruitment. Indeed, some of the biggest players set a trend for smaller firms by working with a cost-saving consultancy to reduce their yearly expenditure on labour. Providing access to real-time management information, allowing companies to analyse and reduce yearly spend and increasing opportunities for efficient budgeting.
Perhaps the most beneficial aspect of using temporary agency workers is its flexibility and responsiveness. Workers can be provided by agencies quickly, as and when they are required. This is particularly useful for construction companies working on both long and short term contracts. The need for specialist skills will vary according to specific projects the use of temporary agency workers accommodates such requirements.
Construction is one of the UK's biggest industry sectors, offering a wide range of services. Within the sector there is huge pressure amongst rival companies to secure major projects, continually innovate and evolve, and above all maintain high standards of health and safety and customer satisfaction.
Construction companies utilise a sizeable amount of subcontractors and temporary agency workers, normally 14% to complete projects with strict deadlines. A wide range of skill sets are often required at very short notice including, construction and site managers, foremen, labourers, surveyors, electricians, engineers, builders and estimators.
Working with de Poel has allowed Rok to understand its requirements better, to reduce its supply base from hundreds to approximately twenty, to reduce its cost base, to improve the supplier performance, to minimise its administration (one invoice per month rather than hundreds), to ensure improved compliance and to have an advanced legal perspective on legislative changes affecting this particular marketplace.
