Construction Productivity Crisis Poses Threat to National Growth, Mace Construct Warns

The construction industry faces a productivity crisis more severe than in the 1970s, posing a "threat to national growth," according to Mark Reynolds, the boss of Mace Construct. Mace's research indicates that the industry is currently 20% less productive than it was half a century ago.

Reynolds pointed to the historical context, noting that the 1930s, during the construction of iconic buildings like the Empire State Building and the Chrysler Building, represented a highly productive period for the industry, albeit with significant compromises in health and safety standards. He believes that digitisation and automation, including robotics, offer a path to substantial improvements.

However, Reynolds cautioned that the widespread replacement of human workers with robots is not imminent. Current humanoid robots lack the necessary strength for many construction tasks, such as lifting the approximately 25kg required for certain jobs, a capability far beyond the 2kg lifting capacity of some existing models. He anticipates advancements in this area within the next five years.

Mace Construct's research suggests that the productivity gap in construction is wider than in other sectors. Reynolds attributes some of this decline to the transient nature of the workforce, a response to uncertainty in labor demand. With a significant portion of construction workers being self-employed and moving between sites and firms, the industry experiences a fluid and casual labor market. This contrasts with periods when major infrastructure projects, such as reservoirs or nuclear power stations, provided a more stable pipeline of work.

Reynolds advocates for a more predictable project pipeline and improved project design as key drivers of efficiency. He suggests that long-term visibility on projects, potentially including the construction of new reservoirs, is essential for effective workforce training. He also highlighted seemingly simple operational changes that can yield significant productivity gains. For instance, relocating canteens within construction sites to improve worker efficiency, as implemented at Heathrow Terminal 5, can save considerable time and money, given that project delays can cost hundreds of thousands of pounds per week.

Reynolds is making these insights public to encourage industry-wide adoption of productivity improvements, which he believes are vital for attracting young talent to a rapidly aging workforce. Approximately 950,000 of the 2.1 million people in the construction industry are over 50. He emphasized the importance of proper training for skilled trades like bricklaying, aiming for standards of around 480 bricks laid per day to ensure fair wages for workers and profitability for employers.

Mace, which stands for Management and Consultant Engineering, is the UK's second-largest construction group. The company recently separated its construction division, Mace Construct, from its consultancy arm, Mace Consult. Goldman Sachs acquired a 75% stake in Mace Consult in a deal estimated between £750 million and £800 million, with Reynolds remaining as chairman of the consultancy. Reynolds indicated that Mace is exploring future strategies, including potential stock market listing, to ensure the business's longevity beyond its current ownership.