Skills exodus as project bids abroad fall victim to lockdown

by | May 6, 2021

The prolonged lockdown cost Ireland up to 800 new homes being built every week according to a report examining the impact of the months-long shutdown of the construction industry.

With construction sites closed for 19 weeks in total, business performance has been severely dented, with many firms facing challenges around cash flow, working capital requirements and retaining highly-skilled staff.

According to the report from Construction Information Services, the CIF’s research partner, work on new housing projects declined by 23.5 per cent in the first nine months of 2020 to 17,615 when compared with 2019.

As the report indicates this will have serious consequences for the supply of new homes for both this year and next.

The report also found that 50 per cent of construction projects over €1million are operational, estimating that around 40,000 workers are on site.

Meanwhile 39 cases of COVID-19 have been associated with the construction industry “indicating how safe construction sites have been made, rendering any lockdown unnecessary.”

The construction industry had expected to complete 28,000 new units in 2021, a figure that was forecast pre COVID-19.

But following the coronavirus impact in 2020, the IHBA had revised their projection for 2021 to 24,000 completions even before the current 2021 lockdown.

The report also highlighted the impact the lockdown is having on contractors’ ability to reach tender thresholds for future public sector work owing to limited income over the lockdown.

This in turn could significantly impact the industry’s capacity to deliver critical public sector projects within the National Development Plan. Likewise, the opportunity to bid for work overseas may be impacted by the lockdown.

Ireland’s top 50 contractors exported €3.3billion in construction expertise in 2019, a figure that is likely to be significantly lower owing to restrictions placed on the industry.

As the report also highlighted, because renovations and home extensions were not deemed essential work under government guidelines, thousands of construction workers have not been working.

“With all European construction industries fully opened, there is a risk that workers may opt to emigrate to where work is available rather than remain on PUP payments,” the report noted.

CIF Director General Tom Parlon said Ireland has been the only country to shut down its construction industry and this is having a number of unintended consequences that again are hugely detrimental and totally unnecessary.

“This report shows every week of this unnecessary shutdown costs 800 homes, €427million in lost output, €156million per week in lost profit and wages, €32million in lost Exchequer revenues and almost 2,800 fewer persons employed,” said Parlon.

“On a weekly basis, I hear from members about the impact of the lockdown on the mental health of our workers.

“Thousands of workers are now considering leaving Ireland in search of work in any other jurisdiction.

“This will have significant impact on the medium-term capacity to deliver essential housing and infrastructure for both private and public sectors,” he added.

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