An investigation Into the Effects of the 2008-2009 Recession on the Construction Industry

Abstract

Construction is the third largest sector within the UK economy. Anecdotally it suffers from large peaks and troughs, or boom and bust periods. During the recent 208-2009 recession it underwent its biggest “bust” since the early 90s. Whilst a great deal of statistical data has been produced by various institutions on the recession and the period since, very little research has been conducted into how these numbers translated down to the industry and whether there were any other lasting effects. The aim of this study was to establish the effects of the recession on both the industry in general and the skilled labour on which it relies so heavily.
Following an initial literature review with focused on collation of data already published on the statistical effects of the recession, a quantitative study was undertaken into the experiences of construction professionals working within the industry. This was targeted at how the downturn affected construction as a whole and more specifically skilled construction workers and their relative availability when procuring them for construction projects.
A questionnaire was produced comprising 11 questions utilising the Likert scale, and sent to 150 construction professionals, largely based in the northwest region of England including 100 from a “main contracting” background, with the remaining 50 from a consultancy background. Collection was achieved through the online survey service “Survey Monkey”, and was analysed through descriptive statistics and cross tabulation via a combination of the service’s own program and Microsoft Excel. Of the 150 questionnaires sent, 31 were received back completed giving a response rate of 20.6%.
There were significant findings in both the literature review process and the research undertaken in Chapter 4. The construction industry was affected more deeply than the rest of the economy with the overall economy dipping by 11% and construction showing a drop of nearly 30%. This was matched by the opinions of the professional questionnaire responses. In terms of its effects on construction trades, though a 30% drop in production was recorded, a smaller, though still significant drop of 14% to employment levels across skilled trades was recorded. Of the individual trades, bricklaying was the most affected with employment levels dropping 28.2% between 2006 and 2015. This was matched by the responses to the questionnaire with bricklaying being noted as the profession that lost the most jobs and being the hardest to procure as we enter the current growth period.