COVID-19 [July] update: its impact on construction projects

COVID-19 [July] update: its impact on construction projects

COVID-19 continues to impact construction projects in the UK. Although the rate of infection is slowing, construction sites, companies and workers are still struggling to get back to ‘business as usual’. Read on for the latest update on how coronavirus is impacting the engineering and construction arena.

Lockdown eased as COVID-19 cases decline

With just over 300,000 cases, the UK remains #5 in the world in terms of total cases of COVID-19. Despite the total number of deaths now exceeding 40,000, we have moved down to the third position, compared to the second position last month, due to Brazil having surpassed 50,000 deaths. The number of new daily cases is now below 1,000, which is good news compared to the peak of 8,681 cases on the 10th of April. There is no doubt that the trend is downwards, but with Germany and China having a second wave of infections in certain cities, it is still too early to say we are close to normality.

Thanks to the positive-looking trend, Prime Minister Boris Johnson announced on 23rd June the easing of some lockdown restrictions. From Saturday 4th July, pubs, restaurants and hairdressers will be able to reopen, as long as they adhere to the COVID secure guidelines. The Prime Minister reinforced the message that social distancing still needs to be strictly followed. When the minimum distance of 2 metres cannot be achieved, an overall minimum of 1 metre may be allowed in conjunction with protection measures like personal masks. The question of when the lockdown will end is still dependent on five key metrics:

  1. The NHS having the capacity to provide critical care across the UK.
  2. A sustained and consistent fall in daily coronavirus deaths.
  3. A decreased rate of infections.
  4. Enough testing and personal protective equipment are held for future demand.
  5. A confidence that adjusting the lockdown measures will not risk a second peak of infections.

Redundancies felt in construction

Until such time as the above five metrics have been met, we will live with some sort of lockdown. As a result, COVID-19 continues to impact the construction and engineering sectors in one way or another. Many organisations have found themselves with no option but to shut down offices and make redundancies, as many of their projects have been paused or cancelled.

The demolition contractor Coleman Group has announced an internal restructuration due to the COVID-19 pressure. In particular, they were driven to make redundancies as a consequence of the cancellation of their single largest project – the transformation of the Broadmarsh Shopping Centre in Nottingham. Another example is engineering and construction company Keltbray, which has announced 300 redundancies over the next few months as a result of the pandemic.

The government tries to re-invigorate projects

The latest data shows a decrease in construction output of 40.1% in April 2020. Private new housing and private new commercial were the largest contributors to this drop, falling by 59.2% and 39.7%, respectively. In order to respond to this fall in construction output, the government has announced new measures to boost the industry. Some of these measures include:

  • Extending consent for construction sites.
  • Granting the Planning Inspectorate the ability to use more procedures to deal with planning applications quicker.
  • Providing builders with temporary flexible construction site working hours.
  • Introducing more than £330bn of loans.
  • Deferring self-assessment payments until 2021.

There is hope on the built horizon

The latest Planning Portal Market Insight Report published in June shows that planning applications were only down 14% relative to expected levels. Also, most regions across England have seen slight growth in the number of applications from April to May. The data shows some early positive signs that there is sufficient confidence in the market to continue with proposals.

Research by UHY Hacker Young shows that the percentage of UK construction workers on furlough decreased from 41% in March and April to 29% in May. Work has resumed on 57 major infrastructure projects with an estimated value of £8.5bn. Build UK Contractor members reported that 97% of all construction sites across England and Wales are now open. Amongst their respondents, an incredible 99% of companies operating on site are said to be adopting the Site Operating Procedures. The situation is quite different in Scotland, where only 21% of projects seem to be open.

Safety and innovation lead the path to recovery

The Construction Leadership Council (CLC) published on 1st June a ‘Roadmap to Recovery.’ In the document, they have outlined a strategy to follow over the next two years for the construction industry to recover from the impacts of COVID-19. Their priorities include innovation, safety and net-zero carbon emissions.

The Chartered Institute of Building (CIOB) has submitted a proposal to the government to integrate major construction sites into the NHS Test and Trace system. This measure would ensure regular testing of workers without risking further transmission of the virus. Contractor Collins Construction has recently confirmed a 53% positive rate of COVID-19 infections in their workforce.

One constant, seen since the pandemic took hold, is the opening of opportunities for new technologies in construction. From BIM services to platform technologies and mobile apps, they have all played a key role in ensuring safety during operations. Construction management software firm Procore has recently published the results of a survey in which they found that two-thirds of construction companies in the UK have rolled out new technologies designed to keep sites operational.

How has the pandemic affected your work or company? Let us know in the comments below!

 

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