Chief executives of no fewer than 24 construction-related associations and companies in the United Kingdom have banded together in an effort to highlight the importance of the construction industry and plead with the government to use the industry to stimulate growth in Britain’s economy.
The 24 executives, a group including Balfour Beatty Construction Services UK chief executive Mike Peasland, Costain Group chief executive Andrew Wylie and chief executive of the Electrical Contractors Association Steve Bratt, have published an open letter to the government in the nation’s Daily Telegraph.
The letter points out that industry, through both the employment and activity that it generates along with the assets it builds, plays an integral role in the British society and the nation’s economy.
It says, however, that current construction output is falling as the economy shrinks, government spending winds back and public infrastructure projects are delayed.
“We want to highlight the importance of construction and its capability,” the letter says. “The UK construction industry is world class and delivers fantastic products. For example, the Olympic venues were built on time, under budget and gave valuable skills to many people, the Shard is an impressive new feature of the London skyline and Crossrail shows the industry’s ability to tackle the largest infrastructure project in Europe.”
In their letter, the chiefs say the importance of construction industry to the nation’s economy cannot be understated.
Given that it employs one in every 12 people throughout the UK, the chiefs say, the industry is a vital avenue of employment. Furthermore, they say, construction has one of the highest economic multipliers of any industry – for every £1 invested in building and construction, £2.84 worth of overall economic activity is generated.
Finally, the chiefs say the industry is not heavily dependent on imports, meaning that 92p of every £1 invested in construction stays in the United Kingdom.
These benefits do not even take into account the productivity benefits in terms of building and infrastructure that represent the industry’s output.
Furthermore, the 24 chiefs say that even in the current environment of public sector fiscal restraint, more could be done to stimulate the industry and create growth, particularly in terms of speeding up decision-making and finding new ways of financing projects.
“Spending on construction generates growth,” the chiefs say in their letter. “The construction industry has a part to play in this [generating economic growth] and is ready to deliver.”
The latest developments come amid reports showing a deterioration in the sector. Figures released last week show that in June, the Markit/CIPS UK Construction Purchasing Managers Index slipped from 54.0 to 48.5 which not only represents a decline in building activity throughout the UK, but the steepest such decline for two and a half years.