Building Beyond Brexit: What You Need To Know
On Thursday, 23rd June 2016, 51.9% of the United Kingdom voted in favour of Britain leaving the EU. Many senior figures predicted that should this vote be passed, the UK would plunge into an immediate economic crisis.
Nine months on and the referendum result has certainly left the construction industry with many questions. How badly has and will the industry be effected? What will this mean for your business? What should your business be doing to prepare?
The industry is operating in a period of uncertainty and it can be difficult to know how to prepare when the outcome isn’t clear. But there are things your business should be doing that will protect it now and in years to come.
We are releasing an eGuide next week that will take you through practical steps your business can be taking, but for now let’s focus on the potential impact of Brexit and how it is effecting the industry so far.
The construction industry has always followed the ‘boom and bust model’, in other words, we have always come to expect economic downturns followed by periods of growth and prosperity.
You could argue that Brexit is no different; perhaps we are just going through another downturn as part of this cycle. We need only think back to 2008 to consider the most recent period of economic instability.
Some forecasts have left businesses feeling understandably nervous. The referendum shook people’s confidence which has led to more conservative spending and less willingness to invest. In many cases this has led to the funding that many businesses require to complete projects becoming harder to secure.
Inflation on import prices has remained high, leading to a high cost for importing materials. When we consider that over a quarter of all construction materials are imported, we can see how serious this cost increase could be to the industry as a whole.
One of the most frequently talked about consequences of Brexit has been the effect it will have on skilled labour in the UK. The construction industry heavily relies upon skilled labour coming from overseas, the majority from European countries.
Nearly 12 per cent of the 2.1 million construction workers employed in the UK come from abroad, according to the Office for National Statistics. So the demographic of labour in the industry is likely to change, as could the cost of hiring skilled staff with wage demands predicted to rise.
In truth, the full extent of Brexit’s effect on the construction industry and the economy as a whole is still to be determined.
In addition to the negative forecasts, there are also positives to consider. For example, some suggest confidence is recovering which will lead back to more of a willingness to invest. What is clear is that as a business it’s vital to focus on what you can control rather than economic fluctuations you cannot.
As a provider of technology in the construction industry, Deltek has witnessed first-hand how the evolution of technology has given businesses the tools to be profitable in spite of periods of uncertainty.
The right technology can provide a robust platform to build your business on. Automated processes and increased efficiency are vital when businesses are working to tight deadlines and looking to protect their profit margins.
So regardless of Brexit’s outcome, you need to act now to futureproof your business.
We are releasing an eGuide ‘Building Beyond Brexit: How the Construction Industry Should Prepare for Change’ next week. The guide will delve into more detail of Brexit’s impact on the industry, as well as taking you through the steps your business can take to protect itself and prepare for change.
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